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Consumer credit counseling (CCC) isn't all that it is cracked up to be. You have probably seen the television commercials where people were helped by a CCC company, and all of their problems were solved. Those are actors - not actual people who have been helped by a CCC. Before going to a CCC, take a closer look at what consumer credit counseling companies actually do, and how they operate.
Consumer Credit Counseling companies claim to be non-profit organizations. This isn't necessarily true. Often, these companies use the non-profit corporations as a "shell" to move assets to a for profit corporation. Many consumer credit counseling companies were founded directly by banks.
Recently, several CCC companies have been investigated by the FTC and the IRS and a few even shut down. Many more are still under investigation.
One of the larger CCC companies, Ameridebt, was recently shut down because the FTC found that they misrepresented that they charge no up-front fee for their services, that they operate as a non-profit, and that they teach consumers how to handle their finances. You can learn the truth about Ameridebt and why they were shut down on the FTC website.
Consumer Credit Counseling companies were not really founded to help people. Many people believe the idea was conceived by banks for the purpose of keeping debtors making payments as long as possible. Basically how it works is the counselor contacts your creditors and works out a new payment plan with them, usually with a lower interest rate. This may sound great, but the CCC charges fees. There is usually an up-front fee or "donation", and monthly fees. You no longer have any control. You send your money to the CCC, they pay your bills under the new terms they have worked out, and you pay them a fee to do so. In some cases, using a CCC costs you more money than you would have paid without their help.
Credit Counseling Companies do not get rid of any of your principle debt. They merely try to negotiate lower interest rates and lower monthly payments. You are paying less interest, but all you really did was redirect money. Instead of paying the interest that was originally owed, you now have a new bill to pay - the monthly administrative fee to the consumer credit counseling company.
Furthermore, consumer credit counseling appears on your credit report. Most banks, lenders, and credit reporting agencies consider CCC to be the same as bankruptcy. In fact, many consider CCC to be worse than bankruptcy. These types of programs have a 90% failure rate.
Fill Out The Form above for more information and a FREE Debt Elimination Consultation
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