Should You Partner With a Consumer Credit Counseling Agency to Pay Off Debts?
When you're battling debt, you have a myriad of options to pay off your bills and get on the road to better money management. From lenders to debt management companies to non-profit consumer credit counseling agencies, it may seem you have the world at your fingertips, all ready to help you wipe your financial slate clean and become debt-free. But those lenders and consumer credit counseling services may not be all that they promise, it's up to you to choose the right path for your financial needs.
When working with a lender, debt relief company, or one of the many non-profit consumer credit counseling services, be mindful of the scams and money-making tactics they may employ to profit from your financial situation (and yes, despite the name, even “non-profit” consumer counseling agencies may collect fees from you and your creditors). In order to find a trustworthy partner that's truly looking out for your best interests, a little research goes a long way.
What to Look for in a Financial Partner
Not all financial partners are created equal. While the majority of lenders, debt relief companies and consumer credit counseling agencies may offer realistic solutions to help you get out of debt the right way, others look to take advantage of consumers who are in financial distress. Here are some tips to find the right partner for you and your needs:
- Verify their record. Research the lender, debt relief provider, or consumer credit counseling agency with the Better Business Bureau. The BBB will have a record of any complaints against the companies, which you should consider when deciding whether or not to work with them. You should try to find a company that has at least an "A" rating with the BBB.
- Avoid any company that makes false promises. How do you identify them? They'll lure you with claims that they'll help you get rid of your debt “quickly” and “easily” or they will tell you they can "slash your debt" by an exorbitant amount. While a good debt relief company or consumer credit counseling service will help you pay off debts, it's not a quick, easy fix. A true solution to your debt problem takes time, patience, and discipline on your part. Think about it – you didn't wind up in debt overnight, so you can't expect to get out of debt so quickly either.
- Don't fall for fees. Many lenders and non-profit consumer credit counseling agencies charge upfront fees for their services. When you're looking to get out of debt, you want all the help you can get from a financial partner. So choose one that doesn't profit until you see success with your debt. Also, understand that a non-profit consumer credit counseling service may still profit off of you and your debts. While many of these agencies offer real solutions and financial guidance, their non-profit status simply means they don't pay taxes on the money they make.
- Expect more than debt relief. A lot of lenders, debt relief companies, and consumer credit counseling agencies can help you get out of debt. But if you truly want to become debt-free for life, you deserve and should expect more from a financial partner. They should offer multiple, realistic options to pay off your bills, based on your current financial situation. In addition, a good partner will work hard to protect consumers' rights and provide ongoing support, financial education, and teach money management skills to help you get debt-free and get on the path to financial freedom. Steer clear of any company or agency that doesn't provide these additional services, as they're likely not looking out for your best interests.
Choosing Between a For-Profit and Not-For-Profit Partner
When everything else is equal, it can be confusing to know whether it's better to work with a for-profit lender or debt relief company or a non-profit consumer credit counseling agency. Many people assume a consumer credit counseling agency is the best choice, simply because the words “non-profit” imply an agency is helping consumers out of the goodness of its heart.
But now that you know non-profits still make money and may charge up-front fees, choosing a financial partner really should be based on their reputation and the solutions and additional services they provide.
The Providers of CareOne Debt Relief Services, offer the best of both worlds – multiple debt solutions as well as credit counseling and financial support. They have helped more than 4.5 million people with their debt by offering customized programs that help consumers get out of debt the right way, while teaching them the skills to better manage their money and create a secure, debt-free financial future. In addition, CareOne offers a wealth of support through expert financial advice, superior customer service, and online community forums.
Whether you choose to work with CareOne or another provider, you now have the tools to make the best decision for yourself. Read more about the differences between non-profit consumer credit counseling services and for-profit debt management companies before signing an agreement with any financial partner.