How To Find Reputable Credit Counseling

If you’re having problems with your credit and need some help, consider calling a legitimate credit counseling agency for assistance. Here’s how you find a reputable one that won’t scam you.

Credit counseling sounds like a dirty word because there are so many fraudulent outfits out there, but not all of them are bad and there are ways you can sort out the legitimate ones from the frauds. The first step is to determine whether or not you need assistance. If you’re stressed out about your financial situation, whether it’s too much credit card debt or difficulty making rent or car payments, you might want a credit counselor. If your debt burden is starting to crush you, you might want a counselor. Counselors can save you from the ugliness of bankruptcy by renegotiating your debts, reducing interest and finance costs, and help you get back on track with sound financial advice. They aren’t magic bullets, but they can certainly help. Counseling is better than bankruptcy.

How do you find a reputable organization? Contact your local or state government’s Consumer Protection Office and get a list of reputable credit counseling agencies. Never start by answering an advertisement or solicitation, always start with your local and state government’s Consumer Protection Office. They’re charged with finding the ones that won’t rip you off and put you further into debt.

Next, confirm that they are a member of the Association of Independent Consumer Credit Counseling Agencies, a national organization of credit counselors, or the National Foundation for Credit Counseling, a national organization of financial educators and credit counselors. Membership isn’t a guarantee, but it’s a helpful indicator.

Finally, schedule introductory consultations with several companies to get a sense of how they operate, how they are similar, and how they differ. Your internal fraud detector should be able to determine which one you’re better off working with. It’s like getting quotes for anything else, you want to get a better feel for what you should be expecting and meeting with several agencies will give you a better idea. Liz Pulliam Weston of MSN Money has a very informative article on credit counseling, including what else to watch out for.

Have you or someone you know ever met with a credit counselor or otherwise sought similar assistance? Do you have any lessons learned?

Jim writes about personal finance at his personal finance blog, Bargaineering.

(Photo: frankieleon)