How to Compare Consumer Credit Counseling Services

As an alternative to defaulting on outstanding debt or declaring bankruptcy, many people opt for entering a debt restructuring program under the auspices of a consumer credit counseling service. While these services have helped a lot of people get back on their financial feet, not every credit counseling program is created equal. Your task will be to find a program that will not only help you eliminate debt but also develop constructive financial habits that prevent you from getting into more debt down the road.

Instructions

1

Identify at least four viable credit counseling services that you believe would be helpful to you. A good place to begin is with programs offered in your area. Most larger towns and cities will have two to four counseling services with a local office. Check the telephone book or ask your local bank for recommendations.

2

Contact each of the services and ask for general information about the program they offer. Along with the basics of their debt repayment program, ask about any educational and motivational resources they provide to clients. Once you have documented information in hand, it will be much easier to determine what support services are common to all the programs, and which ones have ancillary services that may be helpful in your case.

3

Find out how much counseling is actually involved in the establishment and administration of the debt repayment program. The best services provide classes in planning budgets and living within your means. They will assign a specific counselor to your case. In fact, seek a permanent counselor who will help you evaluate your current income and expenses and help you prepare a realistic budget. Any service that provides you with a worksheet and shifts you from one associate to another is not what you want. Personalized help is what you need to turn your situation around.

4

Set up a comparison chart. This can be on paper, on a whiteboard, or on an electronic spreadsheet. In one column, make a list of every tool or support offered by all of the consumer credit counseling services you are comparing. Create a header and column for each service you have received information on. Place a check in the appropriate field to indicate a service or support option provided by that particular counseling service. The creation of this simple visual aid will quickly make it obvious which are the two top choices.

5

Investigate the two most likely candidates. Ask pointed questions about each program to make sure you understand how it works. Verify the program has the ability to work with your creditors and create a plan that will satisfy you and everyone you owe. Make sure you understand any fees or charges that are bundled into the payment you will make to the service each month. Your goal is to choose the program that will get you out of debt, teach you how to stay out of debt, and will offer you consistent support all the way through the process.