How to Find Reliable Debt Advice Without Worsening Your Finances
Rising credit card delinquencies are pushing more Americans to seek debt help. Here's how to avoid advice that could leave you deeper in the hole.
A growing number of consumers are struggling to keep up with credit card repayments, raising demand for debt counseling services — and with it, the risk of falling prey to guidance that worsens rather than resolves financial hardship.
Debt advice varies widely in quality and intent. Free, nonprofit credit counseling agencies are generally considered the most trustworthy option, offering budgeting help and debt management plans without the hidden fees that can accompany for-profit services. By contrast, some commercial debt settlement firms charge substantial upfront or ongoing fees while negotiating with creditors on a borrower's behalf — a process that can damage credit scores and leave consumers worse off financially.
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Experts caution that consumers should verify any debt counseling service before engaging with it. Red flags include guarantees of debt erasure, pressure to stop paying creditors immediately, or demands for large fees before any service is rendered. Legitimate agencies typically assess a person's full financial picture before recommending any course of action.
For those already behind on credit card bills, early intervention tends to produce better outcomes. Contacting a creditor directly about hardship programs is often a viable first step, as many issuers offer temporary relief measures such as reduced interest rates or deferred payments without requiring a third party.
With household debt levels remaining elevated and interest rates still high, financial advocates say the stakes for choosing the right kind of advice have never been greater. Continue reading at BBC News.
