Expert tips on choosing a credit counseling agency

With the debt levels at all time high, credit counseling agencies are reaping on the boom. However, as a consumer, it is in your best interest to choose a credit counseling agency wisely. In generally accreditation is helpful and an accreditation with either the National Foundation for Credit Counseling or the Association of Independent Consumer Credit Counseling Agencies is recommended. When you have narrowed the list of credit counseling agencies you want to work with, it is a good idea to call up your local Better Business Bureau and see if any complaints are filed with them. If a credit counseling agency has many complaints filed against them, you are better advised to move on with other companies. It is also important to understand what is being offered by a credit counseling agency. A reputed credit counseling agency will offer you a range of services including a certified personal counselor, personal financial budget calculation worksheet, DMP (debt management plan) details, work with creditors to lower interest and a lot of free resources and credit counseling information. If a credit counseling agency offers erasing your credit history, it generally indicates a red flag. Credit history cannot be erased. Accurate information about your credit accounts will stay on record for 7 years. Credit counselling fees: A reputed credit counseling firm will offer budget services for free and charge you for DMP (debt management plan) or other premium services you seek. As a consumer look out for a reputed credit counseling agency that will charge you between $15 - $30. $50 can be considered at the high end of the spectrum when you are totally comfortable with the services they offer. Try to gather further information on credit counselors. Ask what kind of training is given to credit counselors. Ideally look for companies that offer training as well as accreditation by an outside source. Additionally ask how the credit counselors are paid? If they are paid a commission, they might pressure you into accepting a DMP. I hope all the above listed information will be helpful in selecting the right credit counseling agency for you. Any research before selecting a credit counseling agency will be time well spent.

Should i consolidate my credit card debts

Unlike general debt where the answer to problems is rarely to consolidate, the consolidation of credit card debt is often worhtwhile. Credit card debt consolidation is regarded by many ias being the first step toward card debt elimination. But, before you taking the initial step towards consolidating your credit card debt, you need to understand that consolidating credit card debt (or using balance transfers) is an action that is being taken to eliminate your credit card debt. Consolidation of your credit card debt is not simply a mechanism for putting the problem away for a while. Credit card debt consolidation is a good option for more than one reason; not only do you get relief from the increase in the amount of your credit card debt, but you may also get other benefits. Many card issuers make offers to new users who transfer in ther existing balances that can be very attractive indeed. Almost all offers for consolidating credit card debt/transferring balances have an initial period with a low APR often as low as 0%. This is, in fact, one of the main reasons why consolidating your credit card debt is an attractive option. As well as low APR, offers for balance transfer often include benefits such as 0% interest on any purchases made during first few months after the balance transfer. This is another thing reduces the rate at which your credit card debt increases. Of course if the purpose is reduction or elimination of debt then new purchases are not the highest priority! These are the two most significant benefits that credit card issuers offer to attract new clients into consolidating their credit card debt with them. After these main benefits there are other benefits such as additional reward points on the issuer's reward. These reward points can be redeemed for other attractive goods/rebates/rewards etc, but thioer purpose is to encourage you to spend more money and increase, not decrease your debt! Sometimes, the new credit card might be one that caters better to your current spending needs both in terms of credit limit and the way that you might use your new card. For example, the new credit card might be co-branded by an airline that you frequently use. The credit card you are consolidating to might open up discount offers to you. But usually these offers all encourage additional spending. The most important thing to remember when consolidating your credit card debts is the reason for doing it. If the purpose was to reduce debt and manage payments then you can and must ignore any offers that will increase your indebtedness. Balance transfers are not offered by card issuers to make it easy for clients reduce their debt - the opposite is true! As a credit card user you must use the tools offered by card issuers to YOUR benefit, not the bank's! Good luck reducing your debt through disciplined credit card consolidation and balance transfer.