Debt checking or also known as debt counseling is a way for people to repay their outstanding debts via an affordable payment schedule that is agreed with creditors. It is a highly regulated, legally protected process that helps consumers get back on their feet. Credit Counseling provides consumers with guidance on consumer credit, money management, debt management, and budgeting. The goal of most credit consultations is to help a debtor avoid bankruptcy if they have problems repaying debt.
It is legal debt relief. If you are over-indebted and struggling to meet your debt obligations, you can apply for a debt check. A qualified debt advisor will help you assess your financial situation and create an affordable repayment plan that will help you cover your living expenses as well. For example, if you’re struggling to create a realistic budget, a credit advisor can review your spending and income and help you identify areas where you could improve and create more money to repay debt.
Your prospective landlord or letting agent may perform a credit check on you before concluding a lease agreement, but your debt advisor can provide them with proof of budget and an allowance for the rent amount. For example, the National Foundation for Credit Counseling (NFCC) has a network of advisors who are specifically trained and certified on student loans. Just make sure you compare advisors and their agencies to find the best solution and avoid debt counseling fraud in the process. Credit advisory organizations are typically non-profit organizations that advise you on how to manage your money and debt.
Debt counseling usually begins with a free initial consultation, during which the advisor assesses your situation and suggests the best path for your individual needs. Even if you choose to work with a debt advisor, it’s ultimately up to you to strengthen your financial health to comply with their guidance. Your debt advisor wants to take a comprehensive look at your finances in order to find the best solutions for your individual situation. The best debt counseling services are often non-profit organizations that focus on the well-being of consumers.
The aim of debt counseling is to teach consumers money management skills so that they can make informed financial decisions in the future. Certified, not-for-profit debt advisors can help you decide whether to take important financial steps, such as enrolling in a debt management plan, consolidating your balances, or even filing for bankruptcy. While some debt advisory services are free (more on that soon), debt management plans usually come with a price. Initial debt counseling sessions are generally free, but you can pay a filing fee and a monthly fee depending on the scope of services provided.
If you have student loan debt, mortgage debt, or even business debt, choose a counseling center that has experience working with people who have been in your shoes.
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Barry Ritholtz is a renowned finance expert, author and blogger. With over 30 years of experience in the financial industry he has gained a reputation as a thought leader and influencer in the investment community.