Reviewing Credit Counseling Companies
- 4 min read
- Make sure that credit counseling is right for you.
- Read online consumer and Website reviews, but with a grain of salt.
- Shop around and make your own credit counseling review.
Making a Quality Credit Counseling Review
The best way to review the quality of service firms, including credit counseling companies is to shop around. Services in general are difficult to compare and rate. Credit counseling is no different.
A good credit counseling service matches your financial situation to the most appropriate debt relief option. A combination of reliability, dependability and friendly service are all components of good service.
Credit counseling agencies offer a variety of services, including budget counseling and debt management programs. A good credit counselor will examine your financial situation thoroughly and provide you with tools to manage your personal finances. (Before considering bankruptcy, you are required to attend a credit counseling program).
The best review of credit counseling companies is one that you do by yourself, including these steps:
- Review Debt Relief Option
- Look at Online Reviews
- Bottom Line: Shop Around
Review Debt Relief Options
Credit Counseling is one form of debt consolidation. Before you search for a credit counseling service, make sure that this is the best option for you. In order to find a company suited for your needs,learn about the different debt relief programs. Here is some basic information about debt relief options:
|Debt Relief Option||Your General Financial Situation|
|Loan Consolidation||You have good credit and a good DTI ratio. If you have equity in your house, than a cash out refinance mortgage is possible.|
|Credit Counseling||You can afford to make your credit card payments, but need help in organizing your budget.|
|Debt Management||You can afford minimum payments, but need help to negotiate lower fees and rates.|
|Debt Settlement||You are struggling to make your minimum payments, your credit is damaged, and you need help to negotiate a settlement on your credit accounts.|
|Bankruptcy||You cannot afford to make your payments and you want to protect certain assets and keep creditors at bay.|
If you are not familiar with the different types of debt consolidation programs, read the Bills.com article about debt relief options.
Quick tip #1
Review your situation, then use Bills.com Debt Coach to help you analyze your financial situation and receive a debt relief option most appropriate to your situation.
You can find two types of reviews, those written by consumers who claim to have tried the service and others by Web sites that claim to have surveyed the product across a wide number of variables. My advice, take any review with a grain of salt.
Some sites offer a comprehensive review of different credit counseling companies, and rate them based on a wide variety of factors. It general it is difficult to measure the accuracy of their results, as no model is presented. However, that does not mean that the reviews are not beneficial. For example, you can learn about some of the important criteria to check for when reviewing a credit counseling company such as affiliation, accreditation, tools and calculators offered, educational materials, and methods to contact them.
Other Web sites offer individual consumer reviews consisting of a single customer expressing their pleasure or displeasure with the company’s service. People with complaints often write individual reviews; however, that is not a bad thing. Learning what kinds of problems other people had will give you a starting point to ask the company specific questions about their services.
It is always difficult to know how objective a site or a reviewer is. Many times companies and Web sites write reviews with a goal of selling a certain company.
Bottom Line: Shop Around
Bills.com recommends that you shop around. First, learn about the program that you are interested in using. If you need more information then read the Bills.com article about credit counseling and debt management. Remember, any good counseling session will review all your options. Although this is not a comprehensive list, when looking for a credit counseling company your review chart should include these factors:
|Company and Service Component||Company #1||Company # 2||Company #3|
|Affiliation (NFCC, AICCCA, etc.)|
|Accreditation of company and counselors|
|Length of Time in Business|
|Types of educational materials and online availability|
|Hours included in budget counseling|
|Price structure and clearness of contract|
|Availability of customer service (hours, phone, internet, personal visits)|
It is difficult to make the right decision regarding your debt problems. Gathering the information takes time and patience. Keep your ears open for recommendations from friends and relatives. To make a decision use available credit counseling reviews, but rely on your own research and shopping experience.
Quick tip #2
Need help with your credit problems? Get a free consultation from one of Bills.com prescreened debt relief providers.
Mortgages, credit cards, student loans, personal loans, and auto loans are common types of debts. According to the NY Federal Reserve total household debt as of Q4 2022 was $16.91 trillion. Housing debt totaled $12.26 trillion and non-housing debt was $4.65 trillion.
According to data gathered by Urban.org from a sample of credit reports, about 26% of people in the US have some kind of debt in collections. The median debt in collections is $1,739. Student loans and auto loans are common types of debt. Of people holding student debt, approximately 10% had student loans in collections. The national Auto/Retail debt delinquency rate was 4%.
The amount of debt and debt in collections vary by state. For example, in Wyoming, 24% have any kind of debt in collections and the median debt in collections is $2680. Medical debt is common and 17% have that in collections. The median medical debt in collections is $1515.
While many households can comfortably pay off their debt, it is clear that many people are struggling with debt. Make sure that you analyze your situation and find the best debt payoff solutions to match your situation.