Credit counselors may serve a useful purpose to you if you are having trouble keeping track of your finances on your own.
There are certain things you will want to find out before you choose which company you wish to work with.
For starters, inquire about their services.
Generally you want to be looking for an organization offering a wide variety of services such as debt management and savings courses, finance and debt management, and budgeting.
Also make sure that the counselors are certified and trained in customer credit.
Avoid companies that only offer a debt management plan and spend an unnecessary amount of time analyzing your finances.
Only sign sign up for a DMP (debt management plan) once a certified credit counselor has spent some time completely analyzing your financial situation, and has given you personal and customized advice in regards to money management.
As a rule, you should not have to pay any organization for information.
Information should be free for anyone who wishes to inquire about their services, because theoretically they should be making their money from people who sign with them and make good use of their service.
Never commit yourself to a DMP over the phone.
Make sure you have an agreement in writing, and read over this agreement carefully before you sign it.
This will avoid getting yourself caught up in something you didn't ask for.
Inquire about the qualifications of the organization's counselors.
Make sure they have been trained by an outside organization as opposed to one affiliated with creditors.
Find out if they are a reputable company by seeking information from sources such as the Better Business Bureau.
You can find out if consumers are filing complaints about the company.
The local consumer protection agency as well as your state Attorney General are also reliable sources of this information.
Keep in mind that if they've received no complaints, the company isn't necessarily legitimate.
But if they have, it's a good sign they're not someone you want handling your money.
Learn about the organizations fees for their services, and make sure those fees can be outlined in a price quote (make sure it's in writing!).
If the fees are too high for you to pay, try to negotiate a reduction and notify them of your circumstances.
If they disagree to helping you because you can't afford to pay their fees, try someone else.
Be sure to ask them if their employees receive a commission on making new clients.
If they choose not to disclose this information, it's usually a bad sign.
Lastly, make sure that these organizations are keeping your information confidential and secure.
You would want the company to be safeguarding your information to protect your privacy.
Misuse of your information is never in your best interest.