Seek credit counseling
Maybe you've tried everything, but still can't pay your bills on time. It might be time to speak to a professional credit counselor to help you put together a plan to pay off your debt and make positive financial decisions.
Consumer credit counseling calls and sessions are confidential. A credit counselor can help you deal with various concerns:
- Financial responsibilities
- Cash and debt management
- Creditor calls
- Pending consumer legal action against you
- Purchasing a home
- Repairing and rebuilding your credit
- Reading credit reports
- Getting back on the road to financial success
You might want to seek credit counseling if you:
- now are paying for items such as food and gas with a credit card, when you used to pay with cash,
- can only afford to make the minimum payment on credit cards,
- make credit cards payments with other credit cards,
- can’t recover financially from an emergency situation,
- are living paycheck-to-paycheck year in and year out,
- are unable to save money for retirement, or
- constantly worry about money.
By using credit counseling services, you show a commitment to repaying your debts, which many creditors considered a positive when reviewing your credit report. They will negotiate with your creditors to agree on a repayment plan, and they might be able to reduce the interest rate on your outstanding balances for accounts in the plan. Generally, they will request you not take on new revolving credit while in a plan. Most plans last three to five years.
Things to consider
- Accounts that you enter into a plan will be noted as such on your credit report for seven years.
- Your existing revolving accounts will be suspended or closed to new charges.
- Read the Federal Trade Commission’s guide, Fiscal Fitness: Choosing a Credit Counselor, before shopping for a credit counselor.
Credit and debt counseling agencies are independent, nonprofit, community-service agencies whose services are available to all members of the community. They don't work for a collection agency, bank, creditor, or US Marshall's office. Those that are members of national organizations, such as the Association of Independent Consumer Credit Counseling Agencies (AICCCA) or the National Foundation for Credit Counseling (NFCC) have strict standards to protect your interests. Many states license these agencies for your protection.
Be sure you choose a nonprofit organization, and be aware that there might be a client fee for these services.
Mapping Your Future is part of Money Management International's family of services to assist students, parents, educational institutions through person-to-person counseling services. For debt and budget assistance, call 1-877-929-9723 to speak with an MMI counselor.