If you’re one of the millions of Americans who are having trouble keeping up with their credit card bills, you’ve probably considered consumer credit counseling as an option to help get you back on track. Reputable agencies like Cambridge offer an extremely valuable service and are very effective at helping people pay down their credit card debt. With all of the debt relief services available today, we know it can be confusing to determine which option is best for your particular situation. After all, everyone’s financial circumstances are unique, so the assistance you receive should be personalized.
Credit counseling has been around for decades, and it’s evolved significantly over that time. The industry is now highly regulated and agencies must adhere to strict standards in order to be able to offer effective debt relief services. In order to determine if credit counseling is the right option for you, let’s look at how consumers can benefit when they use our services.
American households today have an average of $15,000 in credit card debt. Too many people rely on their credit cards to make ends meet and often find themselves having difficulty making even their minimum monthly payments. As their balances increase, so do the monthly payments, making it more and more difficult to keep their accounts current. They begin to miss an occasional payment. This cycle continues as their accounts are assessed late and over-limit fees, increasing their balances and minimum payments. Consumers find themselves unable to keep up, until eventually they simply fall too far behind and, one by one, their accounts become seriously delinquent.
At this point, there are really only a few options left, and credit counseling is certainly one of the safest.. Bankruptcy is a viable option for certain situations, and sometimes it’s really the only option, but for many people, credit counseling is a simple, safe, effective way to responsibly pay off your credit card balances, without having to get another loan.
The way it works is relatively simple. You’ll first need to speak with a certified credit counselor from the agency that you’ve chosen (see” How to Choose the Right Credit Counseling Agency” below). Your counselor will perform an in-depth review of your entire financial profile to try to figure out what circumstances have led to your need for their services. This is an important part of the process because it also allows the counselor to take a look at your household budget, if you have one. If you don’t, they’ll help you set one up. If you do, a few simple adjustments to your budget may be all you need to free up enough money to get yourself back on track without assistance.
If you become a credit counseling client, you’ll make one payment to Cambridge and we will disburse individual payments to each of the creditors you’ve included on our program. As a result of your enrollment with our agency, your creditors may offer certain benefits to help you get out of debt faster, while often saving you money in the process. One of the most significant benefits that creditors typically extend to clients of a consumer credit counseling agency is a reduction in your credit card interest rates. In fact, our typical clients’ interest rates are reduced by an average of 14 points – from roughly 22% down to just 8%.
These interest rate reductions will also allow many of our new clients to save money, too. Our typical clients save an average of $142 per month due to these interest rate reductions. This extra money can be used to either build savings or pay down other debt that you may not have included on the program. There are many other benefits to enrollment in our program, and your credit counselor will discuss them with you during your free consultation.
Choosing a reputable credit counseling agency can be confusing. After all, there are hundreds of them across the country, many of them offering their services nationwide. So how do you know which one is “the best”? For starters, according to the Federal Trade Commission’s guidelines, one of the first things to look for is whether or not the agency is non-profit. However, keep in mind that just because the agency is non-profit, it doesn’t mean they’re legitimate. The term “non-profit” can be deceiving. People think that non-profit means “free.” It doesn’t. Credit counseling agencies are just like any other business. They have offices, staff, and expenses just like any other business and they need clients to pay for their services so they can keep their doors open. So, you’ll need to look further to determine if the non-profit you’ve chosen is a good choice.
The great thing about having to make a difficult decision these days is that there is plenty of information available to you online. Consumer review sites are a great starting point because you’ll be able to read about the actual experiences of real people who have used these services. A site like ConsumerAffairs.com is a good example of a consumer site that ranks agencies according to the ratings that their customers have given them. Take some time to read through some of the reviews. Chances are you’ll find a review from someone with a similar situation as yours, which will help put your mind at ease that you’re making the right decision.
Next, take a look at the agency’s Better Business Bureau rating and whether or not the agency has any complaints about them. Be sure to stick with an agency with at least an “A” rating. If the agency you’re looking into is not listed with the BBB, consider this a huge red flag and move on. A BBB rating is like a credit report in that one black mark could have major consequences on the rating. An agency that maintains an “A+” rating and has been registered with the BBB for a long time is a good indication that you’re on the right track.
Now that you’ve looked at some external sources, it’s time to take a look under the hood to really get a feel for how the agency will help you. A good place to start is the credit counseling agency’s website. While you’re touring their site, ask yourself a couple of questions: Does the agency offer a range of services? Is there free information available online? Are they transparent about their fees and client success? Are they licensed in your state, and is their license current? All of these things and more should be available on the agency’s website, so be sure to look through it. The main focus of credit counseling is education, so be wary of agencies that push too hard for a debt management plan, which should be evident on their website.
Finally, and perhaps most critical, be sure that the agency employs qualified credit counselors. Again, with a little research, you should be able to find the qualifications of their credit counselors on their website. What you’re looking for are counselors who are certified by a third party and who have the proper experience to be able to provide you with effective assistance. Be sure that they are certified with independent bodies such as the Association for Financial Counseling and Planning Education (AFCPE) or the Partnership for Financial Education (PFE). Certification agencies like these ensure that counselors participate in continuing education so that they’re kept up-to-date with the latest trends and industry best practices.
Cambridge has been providing consumer credit counseling and financial education services nationwide since our inception in 1996. Our nationally certified counselors are among the most respected in the profession, averaging more than 12 years’ experience in helping people get out of debt. Cambridge is a 501(c)(3) non-profit agency with an A+ Better Business Bureau rating, and we’re proud to be the top-rated credit counseling agency by ConsumerAffairs.com. Cambridge is also a HUD-approved housing counseling agency, and we provide both bankruptcy and reverse mortgage counseling services. For a complete listing of license information, please visit our credit counseling disclosures page.
My wife introduced me to Cambridge - she had gone through them and they saved her a lot of money and they did the same for me. Most of my credit card debt that I went into was through a divorce I had back in 2006 to 2008 where I accumulated over $40,000 worth of credit card bills. To have that paid off in five years was a true blessing. It was nice to be able to save that much money and for everything to be legitimate and on the up and up.
Cambridge is the best. I consolidated years and years of debt before with Cambridge. Anytime I needed advice I did not mind calling. They were very good to me and would always send me emails. I might have to come back to Cambridge because I have been in and out of the hospital. I got so many hospital and doctor bills. My daughter was also with them. She's the one who recommended it to me.
I would recommend Cambridge Credit Counseling to anybody--they were awesome! There came a time when work was really slow and I was overwhelmed with bills that I was handling that I couldn't handle. Cambridge lowered the interest rate for me. I tried to make sure I had the money in there and it was spelled out pretty simple for me. It's not been a full month yet since my debts have been paid off but my life is now better. It feels good to have it paid off.
I had some accounts that were very past due and I couldn't get to catch up with paying my principal balance down, so I decided to go with Cambridge. They were able to lower my interest rate. The person that helped me out, Emma, was very helpful when I talked to her and we talked a few times with getting set up. And it's been great--it helped me out a lot. I finished the program already, and I'm definitely in a much better place than when I started.