 TITLE: Consumer Credit Counseling Service - Get the Facts CONTENT: Understanding Consumer Credit Counseling Services\n-------------------------------------------------\n###### Written by: Kristy Welsh\n_Last Updated: July 13, 2017_\nMany people are so far in debt they don't really know what steps to take to get themselves out of debt. If you ever visited our discussion forums, the most active category is the debt settlement forum, with hundreds of people asking and answering questions every day about debt and how to get out of debt. One service out there for people to use is called Consumer Credit Counseling Services (CCCS). But how do you know if this is right for you? Read on.\nBack in 1951, the National Foundation for Consumer Credit (NFCC) was founded to promote credit and financial awareness in response to a new product called credit cards. Soon after, credit counseling emerged as part of the NFCC's nonprofit services and individual CCCS offices began opening up all over the country. These office were independently operated but all under the central membership of the NFCC.\nIn 1993, the Financial Counseling Association of America (FCAA) was founded and offered an alternative to the NFCC. CCCS offices can be members of either parent organization or both and all offer free of charge debt counseling to consumers.\nHow Does Consumer Credit Counseling Work?\n-----------------------------------------\nConsumers who call a CCCS office talk to a certified counselor in a confidential, non-judgmental 45 to 90 minute session. The counselor offers expert advice along with a workable budget based on the client's financial situation. Using this information, the counselor offers a realistic plan for paying down debt, increasing savings, and improving the client's overall financial situation. This session is free of charge and carries no obligation.\nSometimes this initial session may be all you need to get your debt under control. But if not, you may need to enroll in a debt management program.\n### Debt Management Program\nIf you need more assistance after your initial session with a CCCS counselor, you may need to enroll in a debt management program. This program combines your debts into one monthly payment that you make to the agency. This how it works:\n**Process:** A debt management plan is an agreement worked out between a credit counseling agency and your creditors. A debt management plan can only be used on **unsecured debt**, such as credit card debt. The credit counseling can usually get some concessions from your creditors, such as a reduction in interest rates or an elimination of late fees. As part of a debt management plan, you need to close your credit card accounts. All of your payments are then combined into one large payment you make to the counseling agency. The agency then distributes the appropriate payments to your creditors.\n**Cost:** Usually there is a program setup fee and a monthly fee. These fees vary depending on the state you live in and your income. Generally, waivers are available if you earn up to 150 percent of the poverty line. Additionally, most agencies have a cap on their fees.\n**Risk:** A debt management program isn't as risky as some other options for managing your debt, such as debt consolidation. A debt management program will impact your credit score because you will need to close your accounts. This is short lived, but it could affect your ability to get loans while you're enrolled in the program. In the long term, using a debt management program can help your credit score by reducing your debt load.\nHow to Evaluate a Good CCCS Agency\n----------------------------------\nAs with anything, it is a good idea to do some checking around before you sign up with a CCCS agency. Not all are the same and the differences between them can be staggering. Call or visit numerous agencies to see which one is a good fit for you. Here are some things to look for:\n*   They give you a full breakdown of your debts and income, and they work with you to establish a budget, send follow up materials and recommend alternatives to a debt management plan.\n*   They propose a debt management plan as just one of many options for managing heavy debt.\n*   They provide numerous educational resources, such as calculators and budgeting tools, to help you learn about finances and managing your money. \nCCCS Agencies We Recommend\n--------------------------\nAccording to numerous sources, here is a list of some recommended Consumer Credit Counseling Services.\n*   ClearPoint Credit Solutions\n*   Springboard\n*   AAA Fair Credit Foundation\n*   American Consumer Credit Counseling\n*   InCharge Debt Solutions\nIt may take a little time to investigate potential CCCS agencies to use, but the investment in time will be worth the investment in your financial future. END