consumer credit couns
Consumer Credit Counseling
Most people who are facing economic trouble are in need of consumer credit counseling. This means that they need some kind of agency or organization to provide them with advice or, in tighter situations, to make special arrangements to get them out of debt.
When consumers find themselves in situations like the ones described above, consumer credit counseling usually comes into play. Instead of living with the daily stress that their debt produces, receiving daily phone calls from their creditors, or falling into a depressed state in which they believe that their life is ruined, people can address their issues by seeking consumer credit counseling advices, programs, and services.
Consumer credit counseling can inform those in debt about steps they can take to resolve their problems, possible alternatives, and the expected consequences of each action. Specifically, they may encourage or discourage someone who is in debt to sell part of his property in order to clear his financial dues.
Another very important service that consumer credit counseling agencies provide is debt management. This means that they will take over the task of paying your debts. Of course this doesn’t mean that you will not pay what is due; you will still pay the money that you have to pay but you are provided with beneficial terms. To be concrete, the agency becomes financially obliged to the lender, and simultaneously, you are financially obliged only to the agency. The agency achieves better interest rates, and you are provided with lower monthly payment fees.
Moreover, by law, the lender is no longer allowed to contact you about your financial obligations because you are no longer connected to him. This greatly reduces the daily life stress that financial pressure brings. You can go about making a new start and hope that you will not make the same mistakes again. For more articles like this, bookmark www.FreeCreditCounselingServices.net
Author: Elizabeth Morgan
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Free Credit Counseling Services and How a Credit Counseling Agency Can Help You to Eliminate Debts
Free Credit Counseling Services offers the following information on how a Credit Counseling Company may be able to assist you in dealing with your debt crisis. There are credit counseling services that are free, however, you should ensure that you thoroughly understand what any credit counselor offers you, regardless of the charges or lack of charges. Much of what a credit counseling agency offers you, you can also find online, including building a budget. Furthermore, nothing is stopping you from picking up the phone and calling each and every creditor and asking them to lower your rates or make some other effort to assist you in ensuring that you continue to make your payments.
The assistance and advice of the credit counseling agency can be a great help when you have debilitating debts and are fighting to take control of them. These agencies can be especially helpful when you are baffled about what to do next or lack self-confidence about your current ability to improve your financial situation on your own. The credit counseling agency may:
Assist you to set up a reasonable household budget.
Evaluate a household budget that you have already made to suggest necessary changes that will help you to get out of debt quickly, prevent the assets loss and so on.
Try to negotiate for lower payments with the creditors and put you into a helpful debt management plan.
Improve your skill to manage money and spending.
However, not all credit counseling agencies are reliable, so just take enough time to choose an agency that is reputable. That means working with a tax-exempt, nonprofit agency that charges you nothing or little for its financial services. I warn you against misidentifying a credit counseling agency for a debt settlement firm. If you are not cautious, it can be a serious mistake to make because a few debt settlement firms try to appear to the public as though they are credit counseling agencies; there are significant differences between the two.
The aim of debt settlement firms is to gain profit from financially stressed people – not to help them to fix their financial situation. They charge quite a lot for their financial services, and many of these firms don’t deliver on their advertised promises. People who employ debt settlement firms frequently end up in worse financial situation than they were before. When you owe too much debt relative to your current income, your most dependable option sometimes is the bankruptcy filing, especially if you are worried that one of the creditors is about to get hold of a precious asset that you own and do not want to lose. You may file the Chapter 7 liquidation bankruptcy, which cancels out most but not all of your bad debts, or the Chapter 13 for reorganization bankruptcy, which provides you 3 to 5 years to pay up what you currently owe and may also lower the amounts of some of your existing debts.
Author: Alan Buchanan
Article by Alan Buchanan of http://www.articlemonkeys.com.
Article Source: http://EzineArticles.com/?expert=Alan_Buchanan
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Free Credit Counseling Services
What is Credit Counseling and is it Right for Me?
Is Credit Counseling right for you?
Are you unable to make your monthly minimum payments on your credit cards?
Are you late paying any of your bills?
Have you tried to contact your creditors? Have those efforts brought no solution, or a solution that you still could not meet?
Are you being chased down by creditors and collection agencies? Avoiding phone calls, and deleting emails?
Do you have a steady, reliable income stream, but it is simply not enough to make those minimum monthly payments?
Can you reasonable restructure your debt and pay it off within about 2-5 years? If you are unable to meet that timeframe, you may be better off opting for bankruptcy.
What is Credit Counseling?
In a nutshell, credit counseling is a process through which consumers are offered education about how to deal with their debt, how to avoid accumulating additional debt and often involves negotiating with creditors to create a debt management plan. A DMP is a plan in which the consumer repays their debt on a repayment schedule. Often, DMPs include the ability to reduce payments, interest rates and fees. After the DMP is created, the creditors close the consumers’s credit accounts to cut off the consumer’s ability to continue to accumulate debt with that creditor.
How do DMPs help a consumer with overwhelming debt?
DMPs can be advantageous for the consumer struggling with debt as the credit counseling agency helps to consolidate the monthly payments of the debtor into one single payment. Typically this payment is less than the sum of each of the individual payments made each month by the consumer. In fact, many consumers find that after having tried to negotiate this on their own, it is only with a DMP that the same credit card bank will now accept this lower monthly payment.
DMPs are also helpful to the consumer as they may also achieve reduction in the interest rates they are charged by their creditors. Some consumers who are behind on credit card payments find themselves paying interest rates in the upper ranges of 20%, close to 30%! By joining a DMP, consumers can find themselves with annual percentage rates lowered to 10% or less, sometimes even eliminating the interest charges all together! This justifies the claims of many counseling agencies that their customers will be debt free in a short range of time as when the interest rates are dramatically lowered, the consumer is able to pay the debt off more quickly. Note that if you are simply looking to reduce your interest payments but you are current with your accounts, you probably should not look into a DMP as the creditors may carry that debt as "past due" in exchange for the lowered interest rate.
DMPs also help customers’ accounts that have become delinquent to a current status and help to impact their credit rating over time. This is also known as "curing" and account or "reaging" the account. The consumer making the payments dictated by the plan on a consistent basis will have these accounts reported to the credit bureaus as current. This, however, does not simply erase the past delinquencies. But with time and the continued payments with the debt management plan in place, the consumer will begin to rebuild a more positive credit history. Participation in a DMP does appear on a consumer’s credit report, and it can impact the consumer’s ability to obtain home or car loans. Some lenders will see this as a negative, as it can indicate that a consumer has not managed their debt well. On the other hand, other lenders can see it as a step in the right direction as it can also indicate that the consumer is taking care of their debt obligations and may be worth the lending risk.
Did you know that Credit Counseling is a requirement for filing for bankruptcy?
Credit counseling is now a requirement for any consumer filing for bankruptcy, as per the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. To meet this requirement, the consumer must complete a program with a nonprofit consumer counseling agency with at least one counseling session. Furthermore, they also have to complete a post-filing education credit counseling session before their debts are fully discharged.
What do I need to know about Credit Counseling Agencies and the negative statements about the industry?
Credit counseling has come under a lot of scrutiny lately with charges that consumers have paid hidden fees, excessively high fees, poor service and many other complaints. Many feel that the agencies take the sides of the creditors more often than the consumers. There are also charges that credit counseling agencies hire employees with little to no formal credit counseling training. So, you are putting your financial future in the hands of an employee who may have no more knowledge financial management than you do!
Beware of any agency that asks you to pay high upfront fees. They will claim to be "debt settlement" specialists and they tell consumers that they will negotiate their debt to "pennies on the dollar", we have all seen the ads and commercials. This is typically NOT a legitimate claim, and by the time they take your upfront fee, and the fees of thousands of others, they have enriched themselves, and preyed on consumers desperate for debt solutions.
While you may be desperate and want to hear postive, hopeful news and advice about your debt, do not fall prey to the con artists that make unrealistic promises. A legitimate credit counseling agency will tell you all of the details of how you and your credit will be impacted, even with the DMP. Make sure that they are accredited, and you can check that through the Association of Independent Consumer Credit Counseling Agencies or the National Foundation for Credit Counseling.
Do your due diligence and you can find a reputable Credit Counseling agency that will help you understand the process realistically, charge appropriately, truly do what they say, and assist you in your Debt Management Plan. This can be a viable alternative to bankruptcy, and get your on a path of financial success and security and freedom from debt in the future.
Credit Counseling Corporations and Credit Counseling Resources will offer information and updates on how credit counseling may be the right fit for you, and how you can work with a reputable credit counseling agency to your advantage. While we do not offer credit counseling services, we will do everything possible to make sure that you can make an informed decision with the information that we provide to you. This also does not constitute legal or financial advice. If you are in need of legal or financial advice, it is always best to take the information you have gathered to an attorney or financial advisor for their input, interpretation and possible legal representation.
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Credit Counseling Resources
- Alternatives to Bankruptcy
- Credit Card Debt Consolidation Company
- Credit Counseling Business
- Credit Counseling Corp
- Credit Counseling Corporation
- Credit Counseling Debt Consolidation
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- Credit Counseling Organization
- Debt Bill
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- Debt Consolidation Home Loan
- Debt Consolidation Lead
- Debt Consolidation Settlement
- Debt Consolidation Settlement Info
- Debt Management Consolidation
- Debt Management Consolidation Info
- Finance Debt Consolidation
- How to Avoid Bankruptcy
- Loans for Debt Consolidation
- Personal Bankruptcy Alternative
- Refinancing Debt Consolidation
- Secured Debt Consolidation
- Small Business Debt Consolidation