Choosing a Credit Counselor

Video Transcript

"You're choosing a credit counselor. Let me give you a few ideas about what you need to be looking for to choose the correct credit counselor for you. Now whether you need just advice or a debt management program, it's very important that you choose your counseling agency very wisely. You'll want to watch out for any overly aggressive tactics, and you'll want to make sure that they give you written disclosures. In particular, you'll want to make sure that you choose an agency that is a member of either the AICCCA which is the Association of Independent Consumer Credit Counseling Agencies, or that they're a member of the NFCC which is the National Foundation of Credit Counseling. You'll also want to make sure that they've been in business at least ten years, this is very important for them to have a good rapport with the creditors that they're going to be dealing with for you. Also it's preferable that you deal with a non-profit agency. You'll want to make sure that they have only certified counselors and that they have a very clean report with your area Better Business Bureau. You'll want to make sure that they're licensed, and bonded in your particular state. And you'll also want to make sure that they provide written contract for you, prior to your commitment with them. Before signing the contract, you'll want to be sure and ask a few questions of this consumer credit counseling agency. You'll want first off to ask what are the fees? Your upfront fee for speaking with them should be no more than about fifty dollars. And if you are enrolling in a debt management program with them, the fees should be very reasonable. If you cannot afford to pay those fees you need to ask them will they consider waiving the fees. Next you'll want to ask them how much time is allowed for the budgeting purpose. There should be at least one hour provided for budgeting. And you'll also need to find out is there any free educational material, or even free educational sessions available for your use. You'll also want to know what about cancellation notices. What if you decide not to continue with the program. First off, there should be an upfront three day cancellation provision, so that you would be under no obligation prior to three days if you decide that that is not the right program for you. There should also be an available notice that you can provide to them to cancel the program any time during that program. You'll also want to consider checking with your local United Way or your family and children services agencies to see if they're affiliated with a consumer credit counseling agency that exists in your area."