Working with a Certified Credit Counselor

Why Choose Certified Counselors

Credit counselors educate consumers on debt and provide options for eliminating it, but their ultimate goal is much higher.

Ideally, credit counselors will help you establish financial goals and show you the path to achieving those goals. whatever they might be.

Is your goal to eliminate credit card debt that is so high you can barely pay the minimum each month? Call a credit counselor.

Is your goal owning a new car, but your credit score is so bad, you can’t get a loan? Let a credit counselor steer you toward success.

Have you found the ideal home, but have no idea what it takes to buy it? Talk to a credit counselor.

Credit counselors are to financial problems what general practitioners are to medical problems. They ask questions, examine painful financial areas, then make recommendations to improve your economic health.

Those recommendations are based on a budget that is intended to improve your cash flow. A good budget should allow you to meet basic obligations: food, shelter and clothing. It’s the other part – areas with room to reduce expenses – that should create the money needed to help pay off debt.

But it takes time to get financially fit. The process isn’t quick, but if you stay focused, credit counselors can teach you how to manage your money, pay down debt and improve your credit score.

How to Choose a Credit Counseling Agency

The first step in selecting a credit counseling agency is to find one that is certified by the National Foundation for Credit Counseling (NFCC), the longest serving nonprofit financial counseling agency in the U.S., or the Financial Counseling Association of America (FCAA).

Family or friends that have used counseling agencies are always a good first stop, but if you don’t know anyone with experience, research on the internet should give you plenty of options. Just be sure you look for nonprofits certified by the NFCC or FCAA.

The NFCC and FCAA have strict guidelines for members, the most important one being that they place the client’s interests first. The member agencies are reviewed by the Council of Accreditation, which certifies that the proper checks and balances are in place to protect consumers. That is a source of comfort for consumers, who worry about being taken advantage of in a stressful situation.

Members train their credit counselors in budgeting, consumer credit, housing, student loans, debt management and bankruptcy. The counselors must pass a test to be certified before they can provide advice to consumers.

Any agency you deal with should show you their certifications. They should provide consumers with action plans and quarterly statements showing their progress at eliminating debt.

If the credit counseling agency you are considering can’t meet those standards, it’s probably time to look elsewhere.

How Credit Counseling Works

Credit counseling service can be provided online, or in person at an agency office, but most often it is done over the phone so consumers have easy access to vital information they normally store at home.

Consult the NFCC and FCAA websites to find member agencies in your area if you want to visit a credit counseling agency’s office. However, if you want to do it over the phone, go to the NFCC or FCAA website, fill out an information form and one of the certified agencies will contact you.

The process for receiving credit counseling is fairly simple: Do some research to find a company their you’re comfortable with; line up documents that include all debts and all sources of income; call the accredited agency; and be prepared to answer questions honestly.

The phone call should last anywhere from 20 minutes to one hour, depending on the severity of your situation. Credit counselors will ask questions about your spending and income. If you don’t have a budget, they will help you draw one up, based on your answers.

They also will want access to your credit report. It’s not unusual for a consumer to forget about some debts because they simply stopped paying them. Your credit report should have the full list of debt obligations you need to meet.

Questions to Ask a Credit Counseling Agency

When doing research for a credit counseling agency, prepare a list of questions that can be answered over the phone or on the company’s website. This should help you narrow the field to an agency that is best suited to solve your problems.

Some of the questions you want answered include:

  • Where do your counselors receive training and certification?
  • What are the fees for your services?
  • What if I can’t afford the fees?
  • Do I have to sign an agreement?
  • Is there a minimum or maximum amount of debt I must have to use your service?
  • If I use your agency for a debt management plan, how do you calculate my monthly payment?
  • What interest rate will I pay?
  • How will a debt management plan affect my credit score?
  • What is the penalty if I miss a payment?
  • How often will I receive progress reports?
  • What steps do you take to protect my identity and information?
  • Can you get late fees waived?
  • What other options can you offer beyond debt management?
  • How are your employees paid?
  • Are you counselors available 24 hours a day?

Types Services Credit Counselors Provide

A good credit counseling agency should be able to set up a household budget for your and offer education and advice on any type of unsecured or secured debt.

If you are part of the 60% of American consumers without a budget, one call to a credit counseling agency will change that. Counselors will help you create a workable budget that will tell you where your money is going and what areas, if any, you can reduce spending.

Unsecured debt includes credit cards, student loans and medical bills. If you qualify, credit counselors will recommend a debt management program to eliminate unsecured debt. If you don’t qualify, or a DMP is not the right solution, credit counseling agencies have referral partners they use.

They also can talk to you about debt consolidation, especially as It regards student loans.

Secured debt includes things like a home, car, boat or property. Credit counseling agencies have partners who specialize in things like foreclosure prevention and delinquent status on student loans.

Credit counselors also provide free educational materials and consumer workshops to help improve financial literacy in areas like homebuyer education, and financial planning.

Tools to Find a Reputable Agency

The National Foundation for Credit Counselors (NFCC), the largest nonprofit financial counseling organization in the U.S., has certified member agencies nationwide ready to help solve your financial problems.

You can call the NFCC at 800-338-2227 or go to their website to find a counseling agency convenient to you. You can visit the accredited agencies in person or receive counseling over the phone or online.

The U.S. Department of Justice provides a similar tool on its website. The Justice Department site has a drop down menu that allows you to select your state, then provides a list of approved providers for that state.

You should research whatever company you select, especially through customer review sites, to be certain it provides the help you need and the quality of service you expect.

If nothing else, you can simply type nonprofit credit counseling agency into your favorite search engine and take your pick from the list provided.

Can Credit Counselors Stop Debt Collector Calls?

The quick answer is: Yes, if you sign up and make the first payment on a debt management plan. Debt collectors know that and typically stop harassing consumers because the debt in question is being addressed.

Most credit counseling agencies say it takes about 30 days after you make that first payment to stop all credit collection calls.

Warning Signs about Credit Counseling Agencies

There are federal laws against charging “up front” fees for credit counseling, yet some companies still do it.

Consumers should not have to pay for the initial budgeting session and any fees after that can only be charged if you sign up for a service and those services have been delivered.

If you are considering a credit counseling agency and they ask for “voluntary contributions” or “up front money”, that should be considered a warning sign that you are dealing with fraudulent business.


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NA. (2018, January) Find a Credit Counseling Agency. Retrieved from

NA. (2018, June 22) List of Credit Counseling Agencies Approved Pursuant to 11 U.S.C 111. Retrieved from

Pyles, S. (2018, March 23) How Credit Counseling Can Help You. Retrieved from

NA. (2012, November) Choosing a Credit Counselor. Retrieved from