Reputable Counselors

• According to the U.S. Federal Trade Commission (FTC), reputable credit counseling organizations have counselors who are trained and certified in credit, debt and money management. A good counselor will review and discuss your financial situation with you and help you create a plan to correct financial problems. The FTC warns consumers to avoid organizations and counselors who won't provide free information about their services unless you first give them details about your finances. The FTC also recommends consumers work with an organization that provides counseling in person instead of online or over the phone.
  
  

Finding a Counselor

• Consumers generally don't have access to individual counselors' work histories. Nonetheless, you should check with a local Consumer Protection Agency and the Better Business Bureau to find out whether any complaints have been filed against a credit counseling organization you are considering. Consumers also can find counselors through the website of the U.S. Trustee Program. This website has a state-by-state list of credit-counseling agencies that have been approved to provide people with bankruptcy counseling. You don't have to be on the verge of filing for bankruptcy to use the counseling services.
  
  

Debt-Management Programs

• Credit counselors usually negotiate with creditors to lower their clients' interest rates and get creditors' fees waived if clients enroll in a debt-management program. A participant in a debt-management program deposits money with a credit-counseling agency that's used to pay the participant's debts. Debt-management program payments are usually made monthly, and they must be paid on time. A program can take four years or longer to complete, depending on the amount of debt a client owes.
  
  

Considerations

• Even the best credit counselors may have trouble negotiating an affordable debt-management plan for their clients. Liz Pulliam Weston notes on the MSN Money website that creditors usually are focused on protecting their profits, so they want to recoup as much as possible on the debts owed. Therefore, debt-management plans may prove to be unaffordable over time for some consumers, especially if the monthly payments required by their creditors leave them with little disposable income to cover unexpected expenses.