When you are facing financial hardship and you find it difficult to pay your debt, approaching a credit counselling service will help you to find a debt solution to get your financial back to a controllable level.
However, not all credit counselling services are truly done their job to resolve your debt issue.
Some of them may just want you to enrol to into their debt management plan and make money from you instead of helping you.
Therefore, you have to be careful when selecting a credit counsellor.
Here are 6 important questions, which you should ask before you deciding the best credit counselling service to approach for debt help.
Question #1: What services do you offer? Look for a credit counselling service that also provides services like budget counselling, personal finance and debt management classes because a counsellor from a company that provides a range of finance services is trained and certified in consumer credit, budgeting and debt management.
The counsellor should be able to develop a personalized debt management program after discussing the entire financial situation with you.
Don't simply sign up any offer on debt management plan (DMP) if the counsellor doesn't spend a significant amount of time analyzing your financial situation.
Keep in mind that DMP may not be the best solution to fix your debt problem.
Question #2: Are you licensed to offer services in my state? Each state may have different requirements for a company to provide financial services.
Some states require these companies to get a state license before offering credit counselling or similar services.
Therefore, you have to make sure the credit counsellor you are approaching is from a legitimate organization.
Question #3: Do you offer free consultation? Most credit counselling services are free in term of consultation and education.
Therefore, don't pay for something that you can get for free.
Move on to next credit counselling agency if the one you approach involves fee in providing consultation.
Question #4: Will you provide a formal written agreement? Debt consultation may be carried out through phone conversation, but don't commit to participate in a DMP until you have read the details of a formal written agreement.
There might be hidden costs that the counsellor doesn't tell you, so you have to be careful to read all documents before you sign them.
Question #5: What are the qualifications of your counsellor? The qualification of a credit counsellor is important to ensure he has sufficient knowledge in providing you the best advice on how to handle your debt effectively.
Try to look for a credit counsellor certified by an organization that is not affiliated with the credit company.
Question #6: What are your fees? When you are proposed with any of debt program involves fees, ask the detailed price quote in writing and specially ask whether all fees are covered in quote.
Sometimes, counsellor won't tell you about hidden fees unless you ask, these hidden fees will normally be written in the contract.
So, you may not aware about them and if you don't read the contract carefully, you may have to pay extra costs.
If you feel you can't afford to pay the fees, ask the counsellor if the fees can be waives or reduced to an affordable amount; else look for elsewhere for helps if the fees are beyond your affordable level.
Summary Selecting a credit counselling service that provides a good professional help is essential in getting your debt problem resolved.
Ask the above 6 important questions to a credit counsellor before you make your decision.