Credit Counseling Services Checklist
By Joel Walsh, Thu Dec 8th

There are credit counseling agencies that rescue people from thedeepest financial holes. There are also credit counselingagencies that just shovel in more dirt. How do you tell themapart? by Joel Walsh

Signs of a Reliable Credit Counseling Agency __Better BusinessBureau Membership The service's website should have a BBB logoand a link to their record on the Better Business Bureauwebsite. Click through the link to check that there are nounresolved complaints against them. Many people only think aboutthe Better Business Bureau after they've been cheated, but bythen there's not much you can do. Working with a creditcounseling agency that is a member of the Better Business Bureaumeans that you can go to them to help mediate any dispute youmight have with the service provider.

__Accreditation Reputable credit counseling services will beaccredited by an independent nonprofit, just as many schoolsare. One such accreditation body is the National Institute forFinancial Counseling Education.

__Fees A good credit counseling agency will charge a small,reasonable monthly fee, usually around $30. Some also charge afee upfront, though this fee should be reasonable (around $50tops). It may be possible to get a hardship waiver of these feesif you truly do not have the $30-50.

__Clear Application The application must clearly say what thefees to be paid are, what the services to be provided are, andin what timeframe all of this will be provided.

__Reasonable Promises Run far, far away from any organizationthat proposes to "wipe out" your debt for you, rather thansimply helping you to repay the debt. Short of your creditorsjust deciding to forget about the debt (unlikely), there is noway to erase debt-even bankruptcy leaves a huge mark on yourcredit report for ten years.

True, your car may not go missing from your driveway if you stoppaying unsecured debt (i.e., debt that is not "secured" withcollateral, like most credit cards, unlike most auto loans). Butyou are still legally obligated to pay the debt, and thepossibility of being taken to court will loom over you. You willlikely be unable to get even "bad credit" financing if you stillhave debts in collections-good luck buying a car or house.

Not Necessarily Signs of a Reliable Agency XX Nonprofit StatusNonprofit status is essentially a tax designation, not agovernment endorsement of a group's mission. There are plenty ofnear-fraudulent credit counseling agencies that are registerednonprofits.

XX Respectable Name Any group can put words like "National,""Alliance," "Assistance," and other trust-inspiring words intheir name. But a name is just a name. Make sure to check anyorganization against the list above to make sure they'rereliable. Also try searching for the group's name on a searchengine. Don't just look for a lack of negative reports-thatmight just mean the group changed names recently. Instead, lookfor positive reviews from real people, and preferably mention onreputable third-party websites, such as news sites.

Ready to find a credit counseling agency? You're in the rightplace: the web is full of credit counseling agencies. Just usethe checklist above, and you'll have no trouble separating thesaints from the scams.

About the author:Joel Walsh has written on credit counseling:http://www.debtguru.com [Publish this article on your website!Requirement: live link for above URL/web address w/ linktext/anchor text: "credit counseling" OR leave this bracketedmessage intact. Permalink:http://debtguru.com/articles/credit-counseling-services-checklist.html]