Many of us are aware of the advantages of consumer credit counseling services that are widely available today. In addition to being able to assess your current debts and financial condition, these services would be able to come up with a debt elimination plan for you in order to either minimize or completely eliminate your debts within a time period. This would eventually leave you a debt-free person, something that is extremely attractive especially to those who are deeply struggling with credit card debts for instance.
Despite the many advantages of this service, it must be known that it also comes with a few cons of its own. Recognized as a different substitute to bankruptcy, consumer credit counseling would not work unless the payments are made on time and without delay, or you might be paying more rather than less. This could also mean your credit rating getting affected. Although most of them claim to be non-profit, do take note that many of these service agencies charge upfront fees (could be as much as a few thousand dollars). In addition to that, a lot of these agencies require you to pay a small amount of monthly fee (that accumulates to quite a large amount of money over a time period of 3 to 5 years).
Other disadvantages include the fact that if you struggle to pay monthly minimum payments for your credit cards, it is highly not recommended to take up this service as monthly payments tend to be higher (to offset the debt that has been acquired as well). To conclude, make sure before you sign up for any credit consumer counseling, make sure you go through the details in the contract thoroughly and agree to the terms before signing. This is sincere advice from a former employee of consumer credit counseling.
