What is Credit Counseling?
Credit counseling is a service that helps people resolve their money problems. Counselors are trained to review a person’s entire financial situation and offer the appropriate solutions. There are many government-approved agencies that offer credit counseling. However, you can get low-cost services from nonprofit agencies, religious organizations, extension offices and non-profit agencies. You can get credit counseling in person, over the phone or online.
It is important for you to make sure that the agency you choose is accredited. The National Foundation for Credit Counseling and Financial Counseling Association of America are two of the organizations that accredit credit counseling agencies.
How to Prepare for Credit Counseling
You will need to gather all information about your financial situation. This includes things such as your paystubs, household bills and credit card bills. You should also write down the cost of things like food and transportation. The more information provide, the more your counselor will be able to help you.
What to Expect During Credit Counseling
When you meet with your credit counselor, your debts and personal financial situation will be discussed. Your counselor will also review your budget and determine if there are ways that your expenses can be trimmed each month. Your credit counselor can also help you find effective ways to manage your debt.
Benefits of Getting Credit Counseling
You will be able to manage your finances better if you go through credit counseling. This will help you reduce your stress. You will also be able to get out of debt faster. Furthermore, your credit counselor understands that everyone’s financial situation is different. That is why they will give you the personalized attention that you need.
What if I Need to File for Bankruptcy?
Many people are able to avoid bankruptcy if they get credit counseling. However, some people are still unable to control their finances. That is why bankruptcy may be the best option. Your credit counselor can still help you if you need to file for bankruptcy. They can help you get a clear understanding of all of the consequences of this.
Bankruptcy has serious consequences. It can stay on your record for up to 10 years. During this time, getting any type of credit may be difficult. You may also have a harder time finding a job. Your credit counselor can help make this process go a lot more smoothly for you.