Credit counseling

Credit counseling is a process that offers guidance and advice on consumer credit, money management, debt management, and budgeting. The goal of credit counseling is to help consumers avoid bankruptcy and to provide primary financial education on managing money.

Overview

Credit counseling agencies have been around for many years. They have helped numerous consumers by providing expert advice on their personal financial situation. These agencies are typically non-profit organizations that are committed to helping individuals who are in financial difficulty.

Process

The process of credit counseling involves a detailed review of a person's financial situation. This is done through a series of meetings where the counselor will discuss the individual's financial situation, help them develop a budget, and provide free educational material and workshops.

Benefits

The benefits of credit counseling include the ability to make one monthly payment to the credit counseling agency, which then distributes that money to the creditors. This can help to reduce the stress of dealing with creditors on an ongoing basis and can help to prevent the accrual of late fees and over-limit charges.

Risks

However, there are also risks involved in credit counseling. Some credit counseling agencies charge high fees, which may be hidden, or urge consumers to make "voluntary" contributions that can cause more debt.

See also

• Debt management plan
• Debt settlement
• Bankruptcy

References

<references />

External links

• Federal Trade Commission on credit counseling

This article is a medical stub. You can help WikiMD by expanding it!
Most recent articles Ongoing trials	Wikipedia