Debt solutions checklist: what to ask the counselor
You think you've found a debt solution to suit you; you've researched the company and they have no complaints against them or legal cases pending. Now you're going to see them in person. Use this check list of questions to ask them before you make a final decision on whether to use their services.
- Is the first consultation free?
- Are the counselors trained and certified? What qualifications do they have? Who certifies them?
- Who funds the company?
- Who regulates the company?
- Are you licensed to offer these services in this state?
- What services do you offer? (Avoid companies that push debt management plans (DMP) and instead look for one that offers budget counselling, debt management advice and training in budget managing skills.)
- Will counselors discuss my entire financial situation with me before making debt management suggestions?
- Will the counselor offer a personalized debt solution?
- Will counselors help me develop a long-term debt solution?
- Are educational materials free?
- What are your fees?
- How are fees paid?
- What if I can't afford them? (If an organization refuses to help because you can't pay their fees look elsewhere.)
- Will I get a formal written contract with details of all costs and all verbal agreements?
- Do I have a written guarantee that all personal information will be kept confidential?
- Do your employees work on commission? Are they paid more if I choose one solution over the other? (Walk away if the answer is yes).
- When will my creditors be paid?
- Can I get access to my accounts by phone or online? When do I get a status report on my account? (Ask for regular, detailed reports.)
- What debts are included in the debt management plan? Is there anything that cannot be included?
- Can your counselors get my creditors to reduce interest charges or waive fees? (Verify the answer with your creditor before accepting any plan from the credit counselling agency.)
- How long before these benefits kick in?
- Will my creditor require a payment to be made to you before accepting me on the debt solution program? (Ask your creditors to verify this before paying the counselor.)
- Can you get my creditors to re-age my accounts? How long before they can do so?
Once you've had an initial meeting with the credit counselling agency don't feel under any pressure to make a decision. If the company representative pushes you for one, walk away. Think about the answers they have given you and be prepared to go through the whole process again with another company if you're not comfortable. Signing on to the wrong debt management plan could end up costing you a lot of money.