Like any other debt relief option, consumer debt counseling looks for the right debt and financial situation for it to work perfectly. Not only that, you also have to identify certain skills within you to see if you can last the whole program. You need to know the process and the sacrifices that you have to make in order to be smart about your decision.
Consumer debt counseling is all about hiring a third party agency to help analyze your debt and finances to find the right payment plan that will get your through your financial crisis. It involves a counselor who will work beside you and guide you until you are debt free – at least if you choose to stay until the whole program is over.
There are signs that will tell you if this type of debt relief option is enough.
A big percentage that will tell you if this is the right program lies in your ability to get past your debt situation. Can you handle the negotiations on your own? Do you have the capabilities to talk to your creditors without being intimidated? Creditors have a lot up their sleeve and if you want to propose a new payment term with them, it may not be as easy as you think. You don’t have to be super skilled but there are characteristics that you must possess. You just have to be patient, consistent with your story and honest about your financial condition. You must be able to show your sincerity in paying off what you owe but you have to be firm that you need to have it in your own terms.
Another question that you may want to ask yourself is your ability to discipline yourself and control your wrong spending habits. Having a professional assist you in mapping out the plan and guiding you it will leave no room for excuses. If you know that you cannot control your habits, it may be wiser to have someone tell you off if you are about to miss payments.
You should also consider the fees that you have to pay for the professional service. While there are consumer debt counseling agencies that offer their services for free, you don’t know where their loyalties lie. If you go for a paid service, you are sure that they will treat you as a client and will prioritize your best interests. Make sure you have enough money for this.
Finally, an important requirement in consumer debt counseling is a stable income to support your payments. What the counselor will do is to help you create a payment plan that you can afford. Although a definite result is a lower monthly payment, there is no debt reduction. Your debt is merely stretched over a longer term. That distribution made it possible to lower the monthly requirements. This will be difficult for you to keep up with if your income is not stable.
One thing that you may be happy to know is that this type of debt relief option will not harm your credit score. It will keep you from having to rebuild your score once you completely pay off what you owe.
If you agree and you have checked out all the qualifications, you can proceed to search for an agency that will provide you with consumer debt counseling services. Make sure though, that you will perform a thorough due diligence to be certain that you are putting your trust in the right company.