Credit Counseling

If self help does not work and you find yourself unable to manage your debt payments you can look up for credit counseling. Many credit counseling companies would have you believe that they are nonprofit organizations but that may not be the case always. Some of them have hidden charges or may pressurize consumers to make 'voluntary' contributions. Paying a high fee is bound to add to your debt.

Try to locate a nonprofit credit counselor who will provide in-person consultancy rather than getting it on a phone or the internet. Many institutions like military bases, universities, credit unions, housing companies and branches of the US Cooperative Extension Service have free credit counseling programs that can guide you in managing money and debt. Check out if your bank provides such a service or can refer a good counselor. Family, friends and local consumer protection agency too can prove to be a good source for recommendations.

A credit counselor will discuss money matters: your income and expenditure, and help you in budgeting after understanding your basic needs. S/he may also be in a position to provide free brochures, pamphlets and other educational materials to help you understand how to develop a personalized financial plan to help you save money to service your debt. A proper counseling session should not take more than an hour of your time and may also have a provision for workshops and/or follow up sessions if need be.

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