What Can Nonprofit Credit Counseling Services Do For You?

It's easy to miss a monthly payment, but difficult to catch up. Harassing letters or phone calls from debt collectors can be embarrassing and stressful. Many people want to pay off their debt but don't know the best way to do so. If you're behind on your monthly payments, contacting a nonprofit credit counselor may help. What does the Consumer Financial Consultation Center do?

Credit counselors help consumers manage their current debt and also advise them on how to avoid debt in the future. They consider current budgets and spending trends and try to cut corners where possible. Your advisor may suggest eating out less often or cutting out some cable channels to make paying your bills more affordable. Once you've cleared your budget, we can work with your creditor to help reduce your monthly payments by reducing high interest rates. Finally, your advisor will provide information to help you stay on track, spend within your limits, and save for your future. Credit counseling and debt management

Debt management is another way to control your debt. Both nonprofit credit counseling and debt management programs contact creditors to lower your interest rate and lower your monthly payments, but there are some differences. Credit counselors may charge a fee for their services, but because they are nonprofits, their fees are small, and the money is used only to cover supplies and overhead costs. Debt management companies are for-profit, so only a portion of your monthly payment goes toward paying off your creditors, and the rest goes toward service fees. When you enroll in a debt management program, it typically does not include information that you can use to stay debt-free in the future. If you're behind on your bills, contacting your creditor to make payment arrangements can negatively impact your credit score. If you're behind on your bills and your credit score is worsening month by month, credit counseling may be helpful. Deciding whether to talk to an advisor or join a management program is a big decision, but it can make just as big improvements to your financial life.

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