Yahoo! Answers*

Question:

Credit Counseling?

Is credit counseling a good idea if I can't get my credit cards paid down? Will it put a flag on my credit report? I plan on going through Consumer Credit Counseling Centers of America sponsored by the United Way. Anyone have any feed back?

Answers:

1) might as well file bankruptcy. its shows up about the same. and at least with a ch. 7 bankruptcy your credit score is repaired faster. truth is... all credit counseling is, is someone who calls your credit cards and negotiates lower rates and payments for you. you can do it yourself and not cause any of the grief of having credit counseling on your credit. call your cards, ask them for a payment plan and a lower rate as long as you stick to the plan... badger them enough and they will do it. remember, no one works for free... credit counseling makes money from somewhere, that somewhere is you. why pay more if you dont have to? by the way... im not wrong. "non-profit" doesnt mean they arent making money. They have to pay their employees somehow. i stare at credit reports and make loans all day. they impact you the same, except ch 7 wipes your debt clean.

2) The first poster is wrong. Consumer Credit Counseling Services 1-800-388-2227 is the largest non-profit credit counseling service in the nation and has agreements in place with all major credit card companies that will lower both your interest rats and monthly payments. I used them several years ago and was debt free in 36-months. It's true that all of your account swill show as "included in credit counseling" on your credit report but they also will show as being paid on time every month so it's not any where near as bad as bankruptcy.

3) What the 2nd poster said! Go with those guys over anyone else. I had a friend try one of the places that advertises they will help...and they didn't. At all. they just made it worse.

4) Credit Counseling works If you’re not disciplined enough to create a workable budget and stick to it, can’t work out a repayment plan with your creditors, or can’t keep track of mounting bills. Many credit counseling organizations are nonprofit and work with you to solve your financial problems. But be aware that just because an organization says it’s “nonprofit,” there’s no guarantee that its services are free, affordable, or even legitimate. In fact, some credit counseling organizations charge high fees, which may be hidden, or pressure consumers to make large “voluntary” contributions that can cause more debt. Most credit counselors offer services through local offices, the Internet, or on the telephone. If possible, find an organization that offers in-person counseling. Many universities, military bases, credit unions, housing authorities, and branches of the U.S. Cooperative Extension Service operate nonprofit credit counseling programs. Your financial institution, local consumer protection agency, and friends and family also may be good sources of information and referrals. Reputable credit counseling organizations can advise you on managing your money and debts, help you develop a budget, and offer free educational materials and workshops. Their counselors are certified and trained in the areas of consumer credit, money and debt management, and budgeting. Counselors discuss your entire financial situation with you, and help you develop a personalized plan to solve your money problems. An initial counseling session typically lasts an hour, with an offer of follow-up sessions. My experience with CCCS was not a good one and finaly dropped them due to the fact, they did not send statements and when I requested one, I got the run around. But that was 10 years ago, so perhaps they have cleaned up their act. Good luck to you on whatever you do. P.S It will put a flag on your credit report.

5) credit counseling sounds like a good idea, but be very careful who you deal with. going through a local, in person agency like united way does offer a little more security than going through say an on line place. still, check the fee schedules, payment schedules and see what they offer in way of a guarantee that they can get your debt reduced or consolidated into one payment. try to get references of other people locally that you can talk to who have used the service. any sort of credit counseling repayment plan will show up on your credit report even if they make payments for you. keep a close watch to ensure the payments are actually being made and credited to your accounts. the new bankruptcy laws have made it more difficult to file a chapter 7 and have debt wiped out, but chapter 13 bankruptcy may also offer an alternative. it has about the same impact, actually, on your credit as other programs and the fees to file are most times about the same (maybe a little higher) as what those agencies charge in the long run. with a chapter 13, you have the guarantee that the payments are made to your creditors and you also have protection from harassment, collections and other tricks creditors use because they, as well as you, are dealing with the federal court system. as long as you make the chapter 13 payments as scheduled, your bills get paid by the trustee and you have the peace of mind to get on with your life. a chapter 13 can run from 3-5 years depending on your income and debt load and you do have to be employed when you file and show proof of ability to make the payments.

6) CCCS is a great program with the right company. Just do your home work find a CCCS program that sends monthly statements and has on line access and you will do just fine. As for the red flag, o please I have clients whom were in our program and done that bought homes, cars and all kinds of stuff at better interest rates then some of the people I know that don't have a CCCS marking on their credit report. The whole CCCS is the same as Bankruptcy lie came from Settlement companies trying to put the wrong client in their program. Its just something they say to gain your trust and discredit the CCCS program. Often Settlement companies will tell you that CCCS is a creditor funded program......... Yep it is but who cares if our interest rate goes from 29.99 % to 7.5 % do you care who funds that program? This I say to all the settlement companies who say that little lie and fool people every day who should not be in their program............Clients lets use our God given common sense. If you go settlement and you don't pay your creditors back and you have tons of collections on your credit report do you think that is going to look very good? Settlement is ONLY for clients trying to avoid Bankruptcy. It is GREAT for the client about to go BK. In CCCS your paying your creditors monthly, they made an agreement with you,Everything stays on time and paid back .......................... I don't know but if you knew a client would pay something back wouldn't you lend them money? Think about it. Kourtnie debthardship.com

7) if you go to http://www.credit-report-repair.us they will work on repairing your credit for one full year and there is a money back guarantee, if you plan on having great credit and paying your bills on time i suggest you sign up, it's only $500 for the year and they can get your credit score up if you pay your bills on time which will allow you to qualify for lower interest over time and more inexpensive monthly payments,

*The answers on this page are supplied by users of the Yahoo! Answers forum. CreditOptions does not necessarily endorse or agree with all of the answers provided.