Consumer Credit Card Counseling

  Consumer Credit Card Counseling  - Credit counseling agencies: 5 big reasons to avoid them  - Jun 9, 2007  

Credit counseling agency is a vital channel between your debt and your creditors. What they do essentially is negotiate with your creditors and reduce your monthly payments and interest burden. But, is credit counseling really that good as it is promoted in various advertisements and campaigns? Take a look at the following points and you might change your perception.

Credit counseling agencies are partly funded by credit card companies, and this is not without its reasons. Whenever a person with credit card debt goes for credit counseling, the credit counseling companies get payments for reducing the interest rates, repayment terms and repayment amount. Credit card companies can give incentives to credit counseling firms for not 'doing their best'.

The personal information with credit counseling agencies can be at risk, if you don't complete the program and withdraw your relations with the credit counseling agency.

It is rare to find a credit counseling agency with relations with all the credit card providers and credit card companies. So, if you hold a wide spectrum of credit card debt, chances are big that your credit counseling agency might not have the 'right relations' to get the best deal for you. This means that for some credit cards you won't get any professional benefits and the rationale of paying high credit counseling fees won't justify itself.

How many of credit card debtors get benefit of credit counseling? A survey indicated that the completion rate of credit counseling agencies is just 26 percent. What happens to the rest? Consider a situation where a credit counseling agency has charged a huge amount initially and was not able to complete the process, or was imposing a deal which was not at all attractive. Things can get worse for the debtor in this situation.

In majority of the cases the credit counseling agencies takes the first payment as their fees. So, your hard earned money goes in vain. Though, this process is highly criticized, but it is still prevalent.

Credit counseling agencies are not with their drawbacks, the best thing is to avoid credit card debt altogether. Good financial practices, avoiding multiple credit cards, staying within your income levels, paying your outstanding balances on time-- all these go a long way in keeping the credit card debt at bay. But, if things really warrant some help, why not arrange an attorney to negotiate your credit card debt for you?

  Consumer Credit Card Counseling  - Credit card debt consolidation and credit counseling - great tools to get rid of credit card debt  - Jun 4, 2007  

If a person has accumulated a large amount of credit card debt due to multiple credit cards, the need for a proper counseling for credit card debt consolidation can't be understated. Credit card debt consolidation counseling helps a person get vital insights into the facts that can help him get control over the credit card debt.

Credit card debt consolidation counselors are experts with a good knowledge of debt management, budgeting and behavioral patterns of credit card holders. These services are vital for those struggling to manage their credit card debts. Also called credit counseling or debt counseling the credit card debt consolidation counseling brings immediate relief to a credit card holder.

A person seeking credit counseling can get it from two types of organizations. The professional or commercial organizations, and the non-profit organizations. As depicted by its name or categorization, the commercial organizations charge money for their credit counseling sessions and consolidation help on the other hand the non-profit organizations offer free of charge services. Just because the non-profit organizations are free, it doesn't undermine their quality of service. The persons associated with such organizations are thorough experts and have lived the trauma of being under credit card debt themselves and hence bring their vital experience to the credit card holder.

When a person approaches a credit counseling agency, the first thing it will do is to take stock of the situation and get various facts about the credit card debt. The credit counseling agency collects data about the income, expenditure and spending habits. It will guide the credit card holder about budgeting benefits and try to inculcate good financial habits.

The actual process of credit card debt consolidation then begins. The debt consolidation company tries to strike a deal by clubbing all your credit card debts into one and then negotiating the repayment deal with a new credit card holder. What actually happens during a credit card debt consolidation is that the credit card holder gets rid of multiple credit card debts and gets a single monthly re-payment schedule. If the credit card debt consolidation company is good enough, the credit card holder can get pretty simpler repayment terms.

Credit card debt consolidation counseling and actual credit card debt consolidation are good instruments to get rid of credit card debt. However, they shouldn't be misunderstood as things that get the credit card debt waived. The debt is still there and has to be repaid, the credit card debt consolidation makes the repayment process easy and the credit counseling equips a credit card holder with the necessary financial skills to get over his credit card debt and have a good financial future.

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