Credit counselling is a process that involves offering education to consumers and establishing a debt management plan to repay the outstanding debt.
If you are behind on payments for unsecured debt, credit counselling agencies can help you get back on your feet. Credit counselling is one option that debtors should seek to avoid bankruptcy, but credit counselling is expensive and tedious
Credit counselling may not be an option if your debt load is too heavy. Creditors have a limit on the amount of money that they are willing to accept to settle a debt. This means, that a credit counselling agency may not be able to reduce your debt significantly enough to totally eliminate it.
A word to the wise, remain cautious when choosing a credit management counsellor. The industry has many fly-by-night outfits that can disappear with your money, and damage what remains of your credit. Also there are good one – you just have to do your research.
Let’s explore the advantages and disadvantages of credit counselling.
Credit counselling has few advantages. The credit counselling agency can:
Credit counselling has many disadvantages:
Most credit counselling agencies’ fees are paid by the lenders themselves. They get paid by holding back a certain percent of your payments for their fees. Some critics complain that the credit counselling industry is just a tool of the lending industry.
Do not despair! If credit counseling is not be the right option for you, there are more effective options that enable you get out of debt faster.
Click here now to fill out our no-obligation financial assessment.
If Credit counseling is the option for you, we will refer you to a reputable credit counselling agency.