Working with a Credit Counselor to Deal with Debt - dummies

Working with a Credit Counselor to Deal with Debt

By John Ventura, Mary Reed

After you have chosen a credit counseling agency to help you get out of debt, your assigned credit counselor will spend time becoming familiar with you and your finances. Your initial face-to-face meeting with the counselor is likely to last about an hour, and you should expect to have a couple of follow-up meetings. If you get your counseling online, you will exchange information and get your questions answered via e-mail.

At your first meeting (or soon after), be prepared to provide your counselor with such information as

  • Your household budget, if you have one

  • A list of your debts, including whether they are secured or unsecured

  • The amount of money due on each debt every month

  • The interest rate for each debt

  • Which debts you are behind on

  • The assets you own and their approximate market values

  • Copies of your most recent tax returns or pay stubs reflecting your monthly take-home pay

The counselor uses all this information to prepare a get-out-of-debt plan that is customized just for you. Not only will the plan provide you with a road map for getting out of debt; it should also help you work toward your financial goals like buying a home, saving for your retirement, helping your children pay for their college educations, and so on.

As part of your plan, the credit counselor may suggest that you enroll in one or more of the agency’s money management seminars and workshops so you can gain the information and tools you need to avoid debt problems in the future and achieve your financial goals. The seminars and workshops may focus on topics like smart budgeting, managing debt, financial goal setting, and so on. Also, the counselor may give you free money management materials to read.