Most people who are in debt can blame it on their own bad spending habits.
Philadelphia, PA (PRWEB) August 17, 2013
In an article published on August 11, National Debt Relief tackles the issue about credit counseling and how it can help control consumer spending. The said article is titled “Could Credit Counseling Help Get Your Spending Under Control?”
The article begins by stating that while it is not the case for everyone, most people who are in debt can blame it on their own bad spending habits. National Debt Relief issues a warning that credit cards can be a huge cause of debt. They explain that the convenience that these cards bring into purchases make it happen. Consumers are enticed by the “buy now pay later” concept of these cards.
The article then proceeds to describe what consumer credit counseling can do to help. The article describes it as going to a credit counseling agency who exist to help people in debt. When a reliable company had been found, a credit counselor will be assigned to them and the professional will analyze the debts of the consumer. The counselor will help create a debt management plan or DMP and will give the consumer materials that will help them be better managers of their finances. The DMP will be presented to lenders and creditors for approval. The counselor will also try to negotiate for a lower interest rate on the debt. When the DMP is approved, the consumer will send one payment every month to the counselor who will distribute it to the different creditors. This will help make the debt payments of the consumer easier and more manageable.
While all of this may sound appealing, the article reveals that there are certain pitfalls to credit counseling. One of them, according to the article, is giving up the credit cards that will be enrolled in the program. The whole process can take 5 years to complete and that means consumers are not allowed to use credit during that time. National Debt Relief thinks that this may be one of the reasons why some consumers fail to complete this program.
But while that is difficult, the article also points out that this is how credit counseling can help correct bad spending habits. The time spent without credit will force consumers to use cash instead - which in time, they may grow accustomed to.
Sometimes, the absence of credit use removes the appeal of credit counseling for some consumers. This is why National Debt Relief listed a couple of options that consumer may want to use. This include debt consolidation loan, the snowball method, cashing out personal savings and debt negotiation.
Of all the options, the debt relief company elaborated on debt negotiation and provided the following tips:
1. The consumer must indicate that they wish to settle or else, they will be forced to file for bankruptcy.
2. The statute of limitations of the debt must be identified by the consumer to determine if they should still pursue debt relief.
3. Consumers must clearly define the terms that they can afford in the settlement agreement.
4. All the agreements must be in writing.
The article also states that some consumers can do their own debt negotiation but for some, they need the help of a professional. To find out how a debt settlement company can help, read the rest of the article through this link: http://www.nationaldebtrelief.com/could-credit-counseling-help-get-your-spending-under-control/.
National Debt Relief is a BBB accredited company that offers debt settlement as their primary service. They also promote debt and personal finance education in their website.