Checking Out the Financial Credit Zone

We've all seen the signs stapled on telephone poles, planted in the ground, on the internet, radio and television. They profess "Clean up your credit score!" or "Buy that new car!" Credit counseling companies have proliferated with the increase in personal debt and the resulting defaults, late payments and foreclosures. But, not all credit counseling companies have your best interest at heart. Many of them are scams, a practice on the rise, according to the Better Business Bureau.

Many of these agencies promise the moon and deliver little or nothing. And not cheaply. The up front money they request can be more than $1500 in some cases. So, if you are in the market for a credit counselor, what are the warning signs you should heed in choosing? How can you separate a scam from a legitimate company (which there are many of, by the way)? Brooklyn bankruptcy lawyers can offer you guidance in choosing an agency, but if you want to explore the options on your own, here are some suggestions.

1. If it sounds too good to be true, it probably is. An old adage, but very true here. Beware of miraculous cures and unreasonable sounding promises.

2. No upfront fees. No reputable company will ask for fees up front. The first consultation should always be free and other visits a small, monthly fee.

3. Do your homework. Before engaging an agency on your behalf, check with the Better Business Bureau or your state's consumer advocate office. Any reported conflicts should have been resolved satisfactorily and in a reasonable amount of time. Brooklyn bankruptcy lawyers also have lists of reputable credit counseling agencies.

4. Beware of high fees. Any high fee or other requested payment that seems unwarranted probably is. No reputable agency should ask for any payment other than the agreed upon monthly fee.

5. Confirm payments with creditors. Some counseling agencies require customers to send in a lump sum monthly that will be divided among creditors. Give those creditors a call on your own to verify that they did indeed receive payments.

So, how do you choose the credit counseling agency for you once you know the pitfalls? Non-profit agencies are always the best choices. There are reputable for-profit organizations as well, but weeding out the bad from the good may be more difficult. A really good agency will offer education as well as counseling, debt consolidation and mediation. After all, once the debts are satisfied, you will want to know you have the knowledge and tools to move on successfully.

Carefully read any agreement from your chosen company. All terms of the agreement should be plainly set forth including any fees, services to be rendered, payment terms, total cost, the length of time required for results, any guarantees offered and the business's name and address. You can also see the assistance of Brooklyn bankruptcy lawyers to guide you through the process.

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When faced with the possibility of bankruptcy, Brooklyn bankruptcy lawyers can help get your financial situation back under control.

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