Credit Counseling Organizations - The Good and the Ugly

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Winning Your Disputes With Credit Bureaus
You see the advertisements in newspapers, on TV, and on the Internet. You hear them on the radio. You get fliers in the mail. You may even get calls from telemarketers offering credit repair services.

They all make the same claims:

* "Credit problems? No problem!"

* "We can erase your bad credit - 100% guaranteed."

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For anyone who has, has had and wants to avoid being had, this series of articles reflects years of continuing research. I'll discuss the worse that can ever happen to people thrown into credit situations - whether through their own doing or as victims and how they were able to come of them in one piece. These article are based on facts as I read and understood them.

A credit report is ... Read credit counseling article



Credit Counseling Organizations - The Good and the Ugly
You can find credit counseling organizations by using a search engine such as Google. Go to google.com and type in credit counseling. Google will more than likely return 20 or more pages of credit counseling listings.

Most credit counseling organizations are nonprofit and work with you to solve your financial problems. But remember, just because an organization says it's a nonprofit doesn't mean its services are free or even legitimate. In fact, some credit counseling organizations charge high fees, or hide their fees by pressuring consumers to make voluntary contributions that only cause you to increase your debt.

Credit counseling organizations offer services through local offices, the Internet or via the telephone.

However, your best bet is probably to find an organization in your city with a local office that offers person-to-person counseling.

Many universities, credit unions, housing authorities, and branches of the U.S. Cooperative Extension Service operate nonprofit credit counseling programs. The advantage of inperson counseling is that you have a person who gets to know you, who can see that you genuinely want to pay off your debts, and who can serve as strong advocate with your creditors. In comparison, Internet-based counselors might see you more as a sort of intangible number.

Here in my city we have an organization called Consumer Credit Counseling Services. It is a true nonprofit and is backed by credit providers. It will work with you to develop a realistic repayment plan. Once both you and your creditors agree on the plan, you send a check each month to Consumer Credit Counseling Services. It then distributes the money to your creditors until such time as you get caught up.

Some reputable credit counseling organizations will also advise you on managing your money and debts, help you develop a budget, and provide free educational materials and workshops. Good credit counseling organizations have counselors who are certified and trained in the areas of consumer credit, money and debt management and budgeting.

Your financial institution, local consumer protection agency and friends and family might be good sources of information and referrals when it comes to finding a reputable consumer counseling organization,

Be careful in choosing a credit counseling organization. Some are basically scam artists, especially those who claim they can repair your credit. Here's what to look for to know it's probably a scam:

* The company wants you to pay for credit repair services before they provide any services.

* The company does not tell you what your legal rights are and what you can do for yourself.

* The company recommends that you do not contact a credit reporting company directly.

* The company suggests you create a new credit identity and then a new credit report by applying for an Employer Identification Card to use instead of your Social Security number.

* The company advises you to dispute all information in your credit report or take an action that seems illegal such as creating a new credit identity.

Also, understand that nobody but you can repair your credit.

Again, your best bet is to work with a local credit counseling organization where you can sit down and discuss your problems face-to-face. In some cases, you may not be able to find a local credit counseling organization that works free. In this case, be sure to ask the organization about its fees before you sign any kind of agreement.

If you feel the fees are too high or the counselor seems more interested in charging you than helping you, just go find another credit counseling organization.

Douglas is a retired advertising and marketing executive and author of the book 198 Tips & Tricks to Save Money and live Better. He is the webmaster of www.all-in-one-info.com, a free resource for information on a variety of subjects. Visit his site to subscribe to his free newsletter, Tips & Tricks to Save Money & Live Better.

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How to Find Credit Counseling

Many people face financial crises at some time in their lives. Credit-counseling agencies work with individuals to help resolve financial difficulties.

Local Agencies

Steps:

1. Interview several agencies to choose a qualified credit-counseling service.

2. Ask each agency if it is a nonprofit organization, what services it offers and how much the services will cost you.

3. Find out if its counselors are certified and if the agency services are confidential.

4. Inquire as to how soon a counselor can take your case.

5. Request that the agency send you information about its organization and services. Any reputable credit-counseling agency should send you free information. If not, consider this a red flag and go elsewhere for help.

6. Check with the attorney general's office or a local consumer-protection agency to find out if consumers have filed complaints about the provider you are considering.

Using the Internet

Steps:

1. Check the Internet for credit-counseling information and services.

2. Look up the Debt Counselors of America, a Web-based nonprofit organization. Its Web site (americancredit.org) includes a wealth of information to help consumers improve their financial lives.

3. Check the Web site of the National Foundation for Consumer Credit (nfcc.org).

Warnings:

Avoid scams by staying away from businesses advertising easy credit repair. While the ads pitch a promise of debt relief, they rarely say relief may be spelled b-a-n-k-r-u-p-t-c-y.

Although bankruptcy is one of the ways to deal with financial problems, it's generally considered the option of last resort.

Bankruptcy has a long-term negative impact on your creditworthiness. It stays on your credit report for 10 years and may hinder your ability to get credit, a job, insurance, or even a place to live.




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Credit Counseling Organizations - The Good and the Ugly
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