Credit Counseling Firms

If you’re in over your head with debt you can’t pay, you may consider contacting a credit counseling firm. These agencies have trained specialists that can offer advice or tailor a plan to help with your situation.  The credit counselor can negotiate with your creditors to reduce interest rates, waive late fees, and lower minimum payments. They may recommend enrolling in a Debt Management Program. In a DMP, you would write one monthly check to the credit counselor to distribute to your creditors. While in a DMP, you would be unable to obtain new lines of credit. But a good debt management program can help you become completely debt-free in two to five years.

A credit counseling agency should be free or have only a marginal monthly cost associated with it. Beware of unaccredited credit counselors, or those that charge large upfront payments.