My Debt Relief Plan

If you’re struggling under a massive pile of debt, one option available to you is credit counseling. Credit counseling agencies are designed to help you put together a plan for getting out of debt. But you need to make sure you work with a reputable credit counselor and that you ask the right questions.

Before selecting a credit counseling agency, you need to do your research on the available agencies in your area. Once you’ve narrowed it down to some good possibilities, you’ll want to interview an agent from each agency before you hire them, sign anything, or give them money.

You’ll want satisfactory answers to the following:

Are they federally approved, nonprofit and tax-exempt? Ask for its copy of the IRS approval of nonprofit status document. If they can’t show this to you but tell you they are non-profit, look for another agency.

Are they licensed to offer credit counseling in your state? Not all states require a license but if yours does, make sure the credit counseling agency has the proper license.

How do they charge for their services? Most reputable agencies do not charge a lot for their services. If you enter into a debt management plan with them, they will most likely charge a monthly administrative fee.

Ask them for a list of all their fees. Some less than reputable agencies will give you a “loan” to pay off all your debts and then you make monthly payments to them. Payments that have rather large interest rates. Steer clear.

Make sure you see the contract. You or a lawyer should look this over before you sign it.

How do the credit counselors get paid? Be wary of agencies that pay their counselors commissions. The commission structure may mean that their best interests don’t line up with your best interests. You’re better off with a credit counseling agency that pays their agents by the hour, or a yearly salary.

Make sure to have these questions, and any others you have, answered before deciding to work on your debt management plan with a credit counseling agency.

Debt relief is often looked upon as failure, but it should not be this way. There are many reasons why you may not be able to pay your debt off. If you have lost your job or had medial problems you may be struggling to pay off your debts. Seeking debt relief should be not be something you put off because you are embarrassed to admit you need some help. This article will provide some debt relief suggestions and tips that may help you gain control.

Get Focused On One Debtp>

Instead of looking at your entire debt situation you should try focusing on one bill at a time. When seeking debt relief you can often times pay off the smallest loan quicker by paying al your extra finds towards this debt. Once you have your smallest debt cut down you can then start on the next debt.

Condense Every Bill

You may try another effective debt relief technique by condensing all of your bills into one larger bill. Then you can make only one payment every month and work on the entire burden faster. The benefit of this would be that you may be able to get a loan that pays off several smaller loans at the same time and eliminates the nasty phone calls. You would of course need to be able to make the one larger payment, but it may be easier than try to deal with several bills every month.

No Interest Please

If you have fallen behind on your bills by a few months then you may be able to get some creditors to drop the interest and allow you to work out debt relief plan of only paying on the principle balance. You would then be able to pay down your loan much faster. This debt relief technique works only if you are a few moths behind and show the willingness to take care of the loan consistently.