Can't pay back your loans? You may need credit counseling

[Sep 17, 2010.]

 

Are you juggling personal loans, credit cards, student loans or other types of debt? If you're having a tough time handling all of your bills, you may need some help getting it all under control. Talking with a credit counselor could get you on track to improving your finances. Use the following tips when signing up for debt counseling.

• Find a credit counselor you feel comfortable working with. Avoid counselors who are vague about their debt programs or don't seem to know much about managing money. Also be wary of firms that demand high upfront fees before providing any services. There are reputable debt counselors who can work with you for free or at a low cost. You shouldn't have to go in more debt to solve your financial problems.
• Remember you'll only get as much out of credit counseling as you are willing to put into it. In other words, don't expect a counselor to solve all your financial problems if you don't do what's required. If you need to save money by sticking to a budget, tracking all your expenses or canceling services you don't need, then do it.
• Look for a credit counselor that offers classes or seminars on managing money. Good money skills go beyond budgeting. Educating yourself about money can help you develop good spending habits, pay off debt, build a savings, and meet other financial goals.
• Look for low-cost, low-impact help. Don't feel pressured to sign up for debt management plans that require you to pay monthly fees or apply for a loan. A debt counselor should be able to help you reach financial goals without locking you into expensive debt management plans for a long period of time.

Credit counseling firms are a dime a dozen. Avoid fly-by-night operations that haven't been in business long or have questionable practices. Look for a credit counselor through reputable organizations such as the National Foundation for Credit Counseling. Local churches and community agencies may also be able to refer you to someone.

 

About Author:

Francine L. Huff is a freelance journalist and the author of The 25-Day Money Makeover for Women. She has appeared on a variety of TV and radio shows.