Non Profit Debt Management Services
If you simply can’t escape debt on your own, you may want to consider non profit debt management. Non profit debt management companies are all basically similar. Most offer relief from heavy payments and high rates by allowing you to pay one lower monthly payment that will cover all your debts. This practice is called unsecured debt consolidation. They simply take your money and make arrangements with your creditors to pay them over a longer period, but there are almost always fees associated with this service, so be careful. Non profit debt management should be used as a last resort instead of bankruptcy.
Not All Non Profit Debt Management Services Are Alike
The National Consumer Law Center warns of some common problems among non profit debt management services, such as excessive costs and deception about fees. However, there are ways to ensure that you are receiving quality service. The Association of Independent Consumer Credit Counseling Agencies is a national membership organization designed to promote quality and consistent counseling among non profit debt management services. You can check with them to get a list of the member agencies near you.
You should also check with the Better Business Bureau to see if others have lodged complaints against the non profit debt management service you are considering, and make sure that the issues have been resolved.
Remember that if an offer sounds too good to be true, it usually is. For example, if the non profit debt management agency you’re considering claims to be able to erase your credit history, do not work with them. There is no way to erase your credit information, unless the information is fraudulent. All legitimate credit information stays on your credit report for at least seven years.
Where to Turn for Non Profit Debt Management Services
One of the largest non profit debt management agencies is CCCS. They provide many options to those overburdened by debt, and they have a solid reputation. However, they’re not free.
Another Approach to Debt Management: Education
One of today’s most savvy financial counselors is Suze Orman, whose books and TV shows have provided many people with non profit debt management tips and advice. Her Web site, www.suzeorman.com, can be a powerful tool for understanding debt and how to eliminate it. Her weekly television show is an hour full of financial information and advice, and it’s free! If you are interested in non profit debt management, check your local listings for The Suze Orman Show on CNBC.
The Federal Government also offers free credit tips and advice relating to non profit debt management on their Web site, www.ftc.gov/bcp/menu-credit.htm.
Alternatives to Non Profit Debt Management
There are basically two alternatives to non profit debt management. First, you can try to arrange payments with your creditors directly. Your creditor should accept less money rather than none. Second, you might consider a home equity loan to repay your debts. This is risky, however, because now you are using your home as collateral. The advantage is that the interest on a home equity loan is tax deductible, whereas credit card interest is not.
By Aaron McCullough