Agency Counseling Credit Debt Management: Heed the following advice to protect yourself and avoid fraudulent firms that claim to specialize in expert consumer credit counseling.
To get out of credit card debt, have you decided to seek assistance and advice from an expert in debt management counseling? If so, you need to know what to look for – and what to avoid – to ensure you hire a consumer counseling firm or individual debt management expert that can best meet your requirements.
Unfortunately, the debt counseling industry is fraught with many less experienced or even fraudulent companies that are more interested in making a fast buck than helping you get out of debt.
Following are some things to consider that will help you avoid the bad apples and find a consumer counseling agency that can effectively address your needs.
Check with Consumer Protection Agencies
One of the first steps in choosing the right agency counseling credit debt management is to check with the Better Business Bureau and local consumer protection agencies. There should be very few, if any, complaints against the counseling agency you are considering.
More importantly, if any complaints are registered, the counseling agency should have evidence on file that details the actions taken to resolve reported issues to the satisfaction of the client.
Confirm Accreditation and Memberships
Any agency you consider should have undergone a rigorous accreditation process by reputable, independent third party organizations, such as the National Foundation for Credit Counseling and Association of Independent Consumer Credit Counseling Agencies.
In addition, the counseling company should also be an active member of one or both of these industry associations. Additionally, an ISO (International Organization for Standardization) certification is a plus, and indicates adherence to quality-driven standards and processes for services provided.
Examine Charges for Services
An agency's fees should be reasonable. What is reasonable? That depends on the services that you will be utilizing, of course. And, you should always compare rates among at least three firms.
For example, if you need help negotiating lower rates or a settlement with a couple of creditors, inquire how much you will pay for this service. If you are told that the fees will be hundreds of dollars, a red flag should go up. Also, if you are required to pay up front, be wary of proceeding with this company.
Yet, if you need the agency to help you administer monthly payments to your creditors in exchange for a single payment from you, then a flat monthly rate instead of a percentage of your monthly payment is a good sign. Again, monthly fees should be reasonable and affordable (not hundreds of dollars).
If you are unable to afford the fees charged by the agency, see if the company is willing to waive, reduce or postpone accepting fees in your consideration. That's an excellent sign of credibility – though not all reputable companies do this.
Analyze Communication Techniques
Watch for the way agency representatives communicate with you. Are they subtly pushing you into signing a debt repayment plan, regardless of whether you need it or not? Watch for to promises that seem too good to be true. These are bad signs.
Conversely, are they willing to show you all of their fees in writing and take the time to explain the details of what you will be paying? Do they seem to be genuinely interested in getting you out of debt? Have they spent sufficient time reviewing your case and do they willingly provide you with your options? These are good signs.
In addition, when a firm provides free literature and/or information on budgeting, financial planning and saving, regardless of whether you choose to sign up with them or not, this signals a reputable firm specializing in agency counseling credit debt management.
Check the Agency's Staying Power
In addition to the above, take a note of other general information about agencies you are considering. These include how long they have been in business, if they can provide you with online or other access to your updated account activity, and if there is going to be a written contract versus verbal assurances. You always want a written contract.
Taking these simple precautions, and doing your homework, can help ensure that the agency counseling credit debt management that you have chosen, serves your interests first.
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