Who is a good Credit Counselor?

I wouldn't go with any of the debt consol companies: examples: like Neway, Ameridebt, Junum. They are generally rated pretty negatively, although some people claim they do ok. I would recommend your local CCCS office (look in the phone book) if anything. Just be prepared to have terrible credit once you are done if you go any of these routes.

You can try negotiating with these companies yourself, though this takes a bit of effort. The results are generally the same or better (sometimes you can negotiate a favorable residual credit rating).

 

CCCS is the only one I would recommend. They are nonprofit.

Make sure you are dealing with the real thing - a lot of companies will use a very similar name.

If you go there, creditors will assume you are serious about working out your problems and will work with them. It will mess up your long term credit, but less than defaulting or filing BK.

Just be careful you get the real thing. There are a lot of crooks in the business. (not all of the others, just some).

 

Maybe other people have had bad experiences with debt counselors --if you have, speak up-- but, given your situation, that's your BEST option..

I'd recommend MyVesta.org (formerly Debt Counselors of America).. They are great..

They will contact all of your creditors and negotiate a better payment plan on your behalf...interest, late fees, and overlimit fees will be reduced or eliminated.. You will pay MyVesta.org one amount monthly, and they in turn will pay your creditors for you..

The only bad side to this: Some creditors may choose to close your account.. (although most that do will allow you to reopen it once you're paid off) Also, some creditors may but a notation on your credit report that you used a Credit Counseling Service. This isn't necessarily THAT bad.. I only had one creditor out of 10 do that.. I quit MyVesta once I got caught up on my payments, called Discover and told them I was no longer using a Credit Counseling Service, and they took the notation off..

Good Luck!

 

Since you're a month late already, your creditors will probably let you go on a "re-age" or "assist" program. That will cut your interest and lower the payment for now, if you really feel that you'll be back in shape in a few months. It sounds like your credit will take a *small* hit either way, but you'll probably get by with just a few lates over 30 days. That isn't so terrible. Like others above have suggested, CCCS will destroy your credit for years to come, similar to a bankruptcy. I would try the "assist" route, especially if you're confident of a financial comeback within the next few months. God bless you and good luck.

 

More people than you think have had bad experiences. I went with one at the recommendation of a creditor. The big problem for me was late pays-when I would send the CCCS my payment, they would send it to the creditor late. And my accounts reflected such. By the time I incurred the late fees associated with these, as well as increasing APRs associated with lates, in the entire year I was with CCCS, my account balances stayed virually the same!

Here is another problem. One creditor didn't receive payment AT ALL during the entire time I was with this company. This is despite my calls and letters trying to resolve the problem. It took withdrawing from the program to get payment credited-of course, I had incurred lates on my credit report as a result.

This agency was recommended by one of my creditors (MBNA). I trusted them, and thought doing this would be in my best interest. You will probably have to actively manage your CCCS relationship to ensure that your payments are being credited proptly and accurately. Also, you should know that depending on what the CCCS negotiates with each creditor, you could continue to be listed as "late" on your accounts for a number of months. They (CCCS) fail to tell you this up front sometimes.

You got yourself into this-hey, it happens to the best of us-but there are numerous options that are a lot less risky other than CCCS. I personally chose to negotiate with each creditor. Some are more willing than others. Yes, it will take time and effort. Yes, at times it will be frustrating. But at least you will know where you stand and will be responsible. And again, this is what works for me. There are other options as well. But don't panic, research what is best for you, and then act.

Good Luck.

 

Although BK is BAD...CCCS is WORSE!!!

PEOPLE HAVE HAD A BK, AND BOUGHT A HOUSE AFTER TWO YEARS, AND GOT UNSECURED CARDS...the people with CCCS couldn't get a MORTGAGE, and couldn't get ANY credit cards...NOT EVEN 100% SECURED CARDS...


JUST FOOD FOR THOUGHT!!!

 

Basically, just tell them the truth; even the lowly Customer Service clerks can usually put you on an assist program. They may have to "clear it with a supervisor." The fact that you're already somewhat behind will help, too. They don't seem to want to help until you're at least a month overdue. Negotiating the account is another matter entirely. I've had a VERY hard time reaching someone to negotiate some of mine.

As far as the BK thing goes, I'm no expert and I don't play one on TV, either, but I've never heard ANYTHING good about BK. Unless you get lucky, it's at least a 10-year scar.

 

Keep your options open. There are people on this board who have filed BK and have a higher score than I do.

As far as how to negotiate, how about calling up the customer service line and asking if the rep you are speaking to has the power to negotiate a reduced payment plan with you because of financial challenges. If not, ask to be transferred to someone who can. Or just ask for a supervisor immediately.

And it would be good to get whatever you have negotiated in writing from the creditor after you have reached an agreement. For instance "Overlimit fees waived, payments of 25$ per month for 12 months." A word of warning-negotiate realistically-if you miss a payment or are late, they will probably end the agreement.

Good luck, and again, keep all of your options open.

 

I think it is quite debatable which is better: CCCS or filing a BK.

It's true that after a BK you can still buy a home and get secured cards, then work up to unsecured cards. But a BK stays on your record for 10 years. Lenders have tightened their underwriting criteria for BKs - most "A" lenders want you to be 3-4 years out of a BK. Plus, your credit, to be reestablished after a BK, has to be PERFECT, with no room for error (especially when it comes to mortgage lenders).

It's also true, though, that going through CCCS trashes your credit, but usually after 3-4 years, you are in a much better position than you would have been in a BK. Plus, if you make a mistake and have another negative mark on your credit report after going through CCCS, you won't be as heavily penalized as you would with a BK on your credit report.

Of course, if you are completely buried in debt and can't see your way out - it could be argued that the credit hit is worth it rather than suffer through years of paying off your debts.

Reestablishment of credit after either event takes lots of hard work, and each situation is different.

 

keltexx
Keep your options open. There are people on this board who have filed BK and have a higher
score than I do.
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I was amazed at that too...ME NO BK...STILL UNDER 700 F.I.C.O. others who have BK---700+ F.I.C.O.

 

f people can get credit pretty easily after BK, then why doesn't everyone do it?

People can get credit pretty easily after BK for the very simple reason that creditors know that after BK they can't file again for another 7 years. So lots of them think it's a pretty safe bet that the consumer will pay off the debt rather than go through the fight again. Also, some consumers end up on a sort of probationary period whereby they are under the supervision of the court as to their expenses and bills. That depends upon the type of bankruptcy filed, of course.

I'll not address any of the rest of your problems or questions because you are at a point in your credit life that the kind of solutions that I would offer would benefit you in the accomplishment of your current goals.

Were I in your shoes and considering the use of a debt consolidation or counseling type of service, I would be extremely careful about whom I picked. Be sure to investigate them thoroughly with the proper authorities such as the BBB, State Attorney General's office and I would furthermore demand some references of them although that might not do much good because if they did give you references they would be sure to give you only those whom they thought would give them good references anyway.

So their references might not amount to all that much.

 

Whoa, Nellie!

As someone who recently emerged from a Ch 7 BK, I wish the 'net had been around in '91 and I could have made a better informed decision. Try negotiating first, and BK is an absolute last resort. Besides, I'm not familiar with the change in BK rules these days, but it may be harder to get.

But I ramble... the point I wanted to make is, BK people cannot "get credit pretty easily". We (they) have to put up with outrageous interest rates, low limits on sub-prime cards, and flat out denial in the retail sector.

Sometimes BK sounds like a good -- or at least reasonable -- way out, but make sure you have tried to exhaust every other avenue first.

 

Bankruptcy seems to be a funny deal at best.
Some people end up losing everything they have almost to the shirts on their backs, others seem to come out almost unscathed.

Some get credit easily after BK, some can't seem to get anyone to loan them the key to the bathroom door at the local gas station.

Don't seem to be any real rime or reason to it all either.

 

Any of those who are recommending CCCS-have you actually used it?

CCCS seems like a fantastic idea in theory.

 

In what sense do you mean better? Maybe if better is better "credit rating in 4 years" I might agree.

However, In garnuth's situation, regardless of credit consideration, BK puts him at least $45k ahead in the game.

option 1: garnuth goes into CCCS with best case. they reduce his interest to practically 0, and he pays $1k/month for 4 years. The ideal thing happens, and in 4 years he has pristine credit reports and now has super credit. During the 4 years, it is highly unlikely he can get a mortgage or car loan.

option 2: declares bk with worst case. He immediately has $1k/month extra versus CCCS. He needs to get some cards to rebuild credit and will pay fees and security which the bank is really mean and NEVER unsecures his account ever. Say its $5k is he out. Since he can't even get a mortage or car loan under CCCS, the fact that he can get a high rate one with a bk is an advantage not a disadvantage. At the end of 4 years he has kinda bad credit, but he has $40k+ in his bank account.

But say in 4 years is up, he want to get that shiny new Lexus IS 300 he has had his eye on. Under CCCS, his credit is great and he gets a super low rate loan. If he did bk , he probably could get a loan but not as low a rate. But he can pay cash if he wants!

Please explain exactly how he is better off in 4 years under CCCS. (other than the warm feeling that he paid his creditors 80% of what he agreed to pay instead of 0%)

 

Again, I HIGHLY recommend MyVesta.org

They negotiate with all of your creditors for better terms...will cut your payments/fees/interest WAY down, and will take one payment and distribute it to your creditors for you.. You can even track your payments, and in turn their payments to your creditors on the internet site!

They help you get back on track.. Only one of my creditors (Discover) put a notation that I was using a credit counseling agency, and they removed it once I wasn't using them anymore..

They're a class act, and can help anyone who needs to catch up and get their accounts current..

jmart

 

Hey, Garnuth. If you'll temporarily adjust your profile to accept private messages, I have something encouraging to tell you!

 

That's what they hope you will think, isn't it?

Whether or not they are a good deal depends upon your situation.

The person who started this thread is in the rare position where it might very well help him accomplish his goals.

For most folks, that's not true. For most folks it is far better to find other ways to get rid of their debts and their adverse credit ratings at the same time. That's far better than BK, paying off or CCCS programs all rolled into one.