English Deutsch Français Italiano Español Português 繁體中文 Bahasa Indonesia Tiếng Việt ภาษาไทย
All categories

how do credit counseling agencies work exactly? if you have 4 credit cards totalimg $5,000 and each have minimum payments currently of approx $35 which barely covers interest, how can they help? do they charge to help? Should you only deal with so called non-profit groups?

2007-08-04 06:25:05 · 5 answers · asked by shadow 12 1 in Business & Finance Credit

5 answers

They lower you interest rates on all you credit cards to 9.9 % instead of the default 32.24%. Which drastically bring down you minimun payments.

They also keep you from receiving additional late fees or over the credit limit fees. Usually about $39 each, so $78/mo.

But let's say you minimum monthly payment is $250, and it is already 60 days past due, and if your credit card company accepts a proposal from consumer credit counseling services (cccs) for $50, the account will keep reporting to the credit bureau as past due until the payments made from cccs catch up to the min due. You might want to take that into consideration because it also hurts your credit, but it is better thatn your accounts reporting as past due and not making any payments. Good Luck!

2007-08-04 06:50:29 · answer #1 · answered by Maria2Blue 3 · 0 1

If you are current on your payments, going for credit counseling or other debt repair companies will absolutely trash you credit score -- almost as bad as bankruptcy.

Instead, you can do it yourself. First sit down and make a strict budget. Eliminate all the extras -- premium cable and internet, cell phone, eating out, new clothes, etc. Take all the money you can squeeze out of that budget and put it on the highest interest rate credit card while paying only the minimum on the rest. Once the highest rate card is paid off, go to the next one till they are all paid off.

You can also get a second job to increase your income and thow that on those credit cards.

Once the cards are paid off, only charge what you can paid in full each month.

2007-08-04 06:49:06 · answer #2 · answered by bdancer222 7 · 0 0

Only deal with non-profit groups , they work with the credit card company to lower your interest a little , it is well worth a little bit of time to go talk to one

2007-08-04 06:30:13 · answer #3 · answered by jon_wayne89 5 · 0 0

Why not try to do the credit repair yourself? There are many wonderful groups online that you where you can get information and talk with others who have done this themselves w/o having to pay anyone to do it for them. Here's just a few of the groups that I would recommend:

2007-08-04 06:38:36 · answer #4 · answered by Nobody's Fool 4 · 0 0

You do not owe enough $ for credit counseling. You'd need to owe at least $10000 for them to get involved.

Supposedly they negotiate a deal with your cc company to lock in an interest rate, close your accounts and then you pay them off.

I had a negative experience with this - a company told me they could get me a deal to lock in a decent interest rate on one high balance card I had - and as it ended up, they screwed up my relationship with my cc company, failed to pay them on time, and did not succeed in getting the deal they said they had - "due to circumstances beyond their control".

Better to get a loan and pay them off at a low interest than to go through all that crap.

2007-08-04 06:30:32 · answer #5 · answered by justbeingher 7 · 0 0

fedest.com, questions and answers