Debt Guide: Credit Counseling Services

Credit Card Reduction Plans:

Option: seek debt counseling help (see below for info)   get professional help designing your payoff plan email this page to a friend   print this Debt Reduction summary sheet

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• Is this the right option for you:
  use this option if you find yourself unable to repay your current debt balances and want to avoid bankruptcy.
  
  This may be the right option if circumstances such as unemployment, loss of income, or other unfortunate event prevents you from repaying your debts.
  
  This option is also recommended if you have collection agencies threatening action. Counseling services can advise and protect you from adverse action.
  
  
  
• Credit counseling services:
  credit counselors will be able to discuss your situation with your debt lenders to either forgive part of the debt or structure a repayment plan that fits your budget.
  
  They will also work with you to establish a monthly repayment plan that fits your budget.
  
  
  
• How the program works:
  you first complete an enrollment form that authorizes the credit counselor to discuss your situation.
  
  click here to start that from our national list of debt counseling professionals
  
  

  the credit counselor will contact your creditors to negotiate a repayment plan that is significantly less than you currently pay — why? creditors will welcome partial payment rather than no payment.
  
  credit counselors will then setup a monthly repayment plan that works for you
  
  you will then make your monthly payments to the credit counselor who in turns divides the payment among the creditors based on the negotiated repayment amount
  
  in most cases, creditors will inactivate your credit cards to avoid charging additional debt.