What can credit counseling do for you?

Credit counseling is a proven method to get you out of debt. You can make a single monthly payment which is disbursed to your creditors. Many of the creditors participating in the program will allow you to reduce your monthly payment and, after you establish a payment history, may reduce or eliminate interest and late charges. That way, more of your payment goes to reducing your debt getting you out of debt faster.

Will credit counseling damage my credit?

If your credit report already lists late or missed payments, credit counseling will likely improve your rating through consistent, on time monthly payments. Also, through credit counseling, many creditors will "re-age" your account, meaning that even if you were late in the past they will report you as "current" as long as you make all your monthly payments on time. Once you've paid off all your debt, you will have a strong foundation to help reestablish credit. However, if you currently have perfect credit, then sending reduced payments to creditors or getting interest concessions through a program could tarnish your credit. A creditor may report a reduced payment as "late" or reflect that payments are being administered by a Credit Counseling Agency. Since the program objective is to help you get out of debt, new lenders may avoid issuing loans until you have completed or withdrawn from the program.

Can I cancel a credit counseling program once I've started?

Being in credit counseling is voluntary. If you drop out of the program you'll lose all of the advantages the program provides including a single monthly payment, lowering your total monthly payments, lowering or possibly eliminating interest, and avoiding harassing collection calls.

How soon will creditors stop calling me?

Collection agency calls typically stop after the 3rd consecutive payment on a credit program. If you continue to receive collection calls after your creditor has posted three consecutive payments, contact your credit counselor. Calls may result if the department that is calling you hasn't been notified about your enrollment status.