Choosing a reputable credit counseling agency is about to get easier. Consider these tips when deciding which credit counseling agency will best be able to help you improve your financial situation.
Nonprofit Organization
Make sure that you seek assistance from an organization that is nonprofit. A nonprofit agency will care more about helping you, rather than steering you toward a specific outcome.
You may verify if an organization has tax-exempt status as a nonprofit charity by searching for it at the Internal Revenue Service. This means that the organization is held to a higher set of standards and is expected to behave as a charitable organization.
Beginning in 2003, the IRS began auditing credit counseling organizations to determine if they were fulfilling their tax-exempt missions. Not all of the violators have been identified, so you must also consider some other factors when choosing an agency.
How they Advertise
Nonprofit organizations rarely use television or radio advertisements. Most listings are public service announcements done as a public service by broadcasting companies. If you see the same debt relief commercial over and over again, chances are it is advertising a for-profit company that aggressively pursues either debt management plans, debt settlement or bankruptcy.
Training of Counselors
Try contacting at least 2 agencies for comparison. Ask how much training the counselors receive. Some agencies will even list this information online so that you can understand their qualifications.
Training by the Council on Accreditation (COA) or the Association for Financial Counseling and Planning Education (AFCPE) are preferred. Additional training is a good sign that the counselors are competent.
Perseverance of Counselors
Counselors are expected to maintain information about your situation and follow-up when appropriate. They are also expected to motivate you to make positive changes in your life and finances.
They are not expected to be pushy or aggressive. If your “counselor” calls you as much as a debt collector, then you should seek help elsewhere. Make sure that you are comfortable working with the counselor you have selected.
Check Reputation
The best credit counseling agencies have good relationships with other nonprofit organizations. They receive regular referrals and are known to be in good standing.
Still, you may wish to check with your state’s Attorney General office or consumer protection division to ensure they have not received complaints on the organization. The Better Business Bureau is another good source to verify an agencies reputation.
Finding a good credit counseling agency is the first step. Once you have determined which agency you want to work with, it is up to you to follow through on changes to improve your financial situation.
Tags: choosing a credit counselor, finding a credit counseling agency