How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
A new question is answered every 9 seconds
Ask a Legal question
Type Your Legal Question Here...
characters left:
8 Lawyers are Online Now

Credit Counseling Questions

Credit counseling is a service that provides people with options on how to become financially stable. Credit counseling offers solutions to the consumer on how to avoid drowning in debt. The goal of credit counseling is to educate the consumer on ways to recover from debt. The credit counseling company will work with creditors and create a Debt Management Plan that offers relief in the form of lower payments, late fees, and interest rates. The credit counseling company will build the debt management plan based off of the arrangements made with the creditors. Below are a few of the more commonly asked credit counseling questions that have been answered by Experts.

I have almost $50,000 in credit card debt and am considering a credit counseling service. Are these agencies trustworthy and what impact will using the service have on my future credit?

In many cases, credit counseling services provide debt solutions and can provide help with a person's credit situation. The amount of credit card debt that you have would be impossible to pay off on a payment plan. Usually, debt consolidation services set a person up on monthly payments and work toward an offer of a lump sum settlement. The settlement usually consists of 50-60% of the original debt. In your situation, you would probably be expected to pay $25,000 plus the cost of the debt service. That would literally take years to accomplish.

An option to consider is filing for bankruptcy if you have little or no assets to lose. Either way, your credit rating will suffer. However, if you choose to file for bankruptcy, you will avoid paying on an endless debt which will allow you to start over and work at building your credit score. Before you spend money on a credit counseling service, you may want to apply that money towards a consultation with a local bankruptcy attorney.

I currently pay $719 per month to a credit counseling service. My beginning debt was $30,000 and is now down to $7700. I cannot reach the credit counseling service. What should I do?

The first thing you should do is read the contract between the credit counseling service and yourself. Look for options that will allow you to terminate the service. You may be expected to pay cancellation fees or penalties for termination the service. There should be mention of these charges in the contract.

If the payments are electronically removed from your bank account, you will need to speak with the bank and find out how to stop the withdrawals. Before you stop the withdrawal, you should contact the companies that are receiving money from the agency. Try to negotiate a payment plan directly with the companies that you owe.

I owe $12,000 in credit card debt and was just given notice of a layoff. How should I approach the credit card company in order to protect my credit score of 800?

In order to protect your credit score, you can make the minimum payment to the credit card or use a credit counseling agency. If you use a credit counseling agency, they can negotiate a lower monthly payment and protect your credit score. Your credit score shouldn't be affected by using the credit counseling service. Your use of a credit counseling service will show up on your credit report however, once you begin making normal payments, that notice will be removed.

How can I have a judgment removed from my credit report? I used a credit counseling service to pay the debt off. The company was bought by another agency and there is no record of the debt.

The first thing you should do is contact the three credit reporting services and request a copy of your credit report. You can request a credit report from each agency once a year at no cost. In writing, you will have to dispute the judgment with each of the credit reporting services. When the agencies receive the dispute, they have to make contact with the company that placed the judgment against you. The company will have 30 days to respond to the credit reporting service. If the company doesn't respond, the reporting agency will have to remove the judgment from your credit report.

How does a debt management plan offered by a credit counseling company effect your credit?

Your credit is going to suffer if you use the debt management plan through the credit counseling company. The reason for this is because the credit counseling company requires that you stop making payments on your debt for 6 months. At the end of the six months the credit counseling company will approach your creditors with an offer to settle for 50% of the total debt. During the months you are not making payments, it will reflect on your credit score. In most cases it is better to file for bankruptcy and erase the debt.

Many people find themselves swimming in an ocean of debt and are unsure of where to turn for help. Credit counseling companies can offer the debt ridden person an option to lower the monthly payments while working towards clearing the debt. However, before you commit yourself to a credit counseling company, you should ask an Expert for legal insight.
Ask a Legal question
Type Your Legal Question Here...
characters left:
8 Lawyers are Online Now

How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
< Last | Next >
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin Kernersville, NC
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther Woodstock, NY
  • Thank you so much for taking your time and knowledge to support my concerns. Not only did you answer my questions, you even took it a step further with replying with more pertinent information I needed to know. Robin Elkton, Maryland
  • He answered my question promptly and gave me accurate, detailed information. If all of your experts are half as good, you have a great thing going here. Diane Dallas, TX
 
 
 

Meet The Experts:

 
 
 
  • Ron

    ASE Certified Technician

    Satisfied Customers:

    21119
    23 years with Ford specializing in drivability and electrical and AC. Ford certs and ASE Certs
< Last | Next >
  • http://ww2.justanswer.com/uploads/FO/fordguy4u/2011-12-17_222940_HPIM1257.64x64.JPG Ron's Avatar

    Ron

    ASE Certified Technician

    Satisfied Customers:

    21119
    23 years with Ford specializing in drivability and electrical and AC. Ford certs and ASE Certs
  • http://ww2.justanswer.com/uploads/lyeung1/2010-07-25_032152_tn_IMG_0241.JPG Dr. Y.'s Avatar

    Dr. Y.

    Urologist

    Satisfied Customers:

    18366
    I am fellowship trained specializing in general urology and reconstructive urology.
  • http://ww2.justanswer.com/uploads/docjohn174/2008-12-13_170143_johnask.jpg John's Avatar

    John

    Home Appliance Technician

    Satisfied Customers:

    13453
    Appliance repair business owner for over 43 years.
  • http://ww2.justanswer.com/uploads/MU/multistatelaw/2011-11-27_173951_Tinaglamourshotworkglow102011.64x64.jpg Tina's Avatar

    Tina

    Lawyer

    Satisfied Customers:

    8472
    JD, BBA Over 25 years legal and business experience.
  • http://ww2.justanswer.com/uploads/dermdoc19/2010-09-30_160749_Photo_122807_015.JPG dermdoc19's Avatar

    dermdoc19

    Dermatologist

    Satisfied Customers:

    3827
    30 years practice in general and cosmetic dermatology
  • http://ww2.justanswer.com/uploads/BI/birddoctor/2012-6-22_173214_birddoctor.64x64.png Dr. Pat's Avatar

    Dr. Pat

    Bird Veterinarian

    Satisfied Customers:

    3383
    25+ years working primarily or exclusively with birds
  • http://ww2.justanswer.com/uploads/RY/rydergar/2012-6-6_192240_IMG0328.64x64.JPG Dr. Gary's Avatar

    Dr. Gary

    Cat Veterinarian

    Satisfied Customers:

    3291
    DVM, Emergency Veterinarian, BS (Physiology)