For some people, finding a way to make ends meet is an ongoing struggle and something which usually causes a lot of stress. In some cases, the debt you have will get so out of hand that bankruptcy will seem like the only way out. Although bankruptcy may be the right fix in some situations, there are other alternatives which may work just as well. Among the best alternatives to filing a full on bankruptcy is having credit counseling done instead. This is a process where a professional credit counselor will sit down with you and discuss the payment options you have and whether or not you are eligible for consolidation programs. Here are a few benefits you can gain when using bankruptcy credit counseling.
Help With a Reduction in Fees and Penalties
While participating in this process will not take away the debt you have, it will help to reduce the amount of fees and penalties. If you think credit counseling is the way to go over all out bankruptcy, then the counselor will help you contact and talk with the debt collectors handling your accounts. This will allow you to save a little money on your repayment plan and to get your delinquent accounts caught up.
Getting Some Activity on Your Credit Report
When choosing to use credit counseling services, you will also be able to get some good activity going on your credit report. The counselors will not be able get rid of the negative reporting on your existing credit report, but they may be able to negotiate with the creditors you have about the way they report. In some cases, the counselor you use will be able to get your creditors to report that your account has been paid as agreed. This will help to put some good activity on your credit report, which in turn could help to raise your overall score.
The Benefits of Debt Management Plans
Another benefit you can gain when using a credit counselor is the debt management plans they may be able to offer you. For some people, the majority of bad debt they have is caused by credit cards. In some cases, the debt management plan you get will be able to take all of the credit card debt you have and allow you to make one payment on it. This will make it much easier on you to keep all of your credit card debt caught up and organized.
Finding the Right Credit Counselor
A vital part of getting the credit counseling you need is by finding the right company to work with. Usually, you will have a number of different credit counselors in your area, which will require you to do a bit of research. Ideally, you want to find a counselor who has a great reputation and a track record of providing quality services for people in your area.
By taking your time and weighing all of the options you have, you will be able to find the right counselor to help with your financial woes.