Finding Qualified Help for Eliminating Debt: 5 Steps


The following is a contribution from Jerry at Repaid.Org. If you’re interested in contributing to Frugal Rules, please see our guidelines and contact us.


If you are reading this blog, there’s a good chance you’re trying to be more frugal in order to reduce the debt in your life. Most of the advice on the web regarding debt assumes one thing: you’re able to handle your current debt load to some extent. But all too often you’re the one being handled by your debt, not the other way around. In that case, you may need some professional assistance. That help is available nationwide. Unfortunately, you will have to sort out the scam artists before you can find a legitimate company that is qualified to help you. Here are a few tips that you can use while you are looking for the right credit/debt counselor.

Eliminate the Debt Scammers

Your first step should be to search one of three major resources: the trade groups Association of Independent Consumer Credit Counseling Agencies and the National Foundation for Credit Counseling. The members of these two groups agree to follow fair business practices, take continuing education, and employ only accredited counselors. A third resource is the U.S. Department of Justice. The department maintains a list of approved credit counselors. Even if an agency appears on an approved list at any of the listed urls, you need to follow through with the steps that come next, if only because mistakes can be made at any level.

Cross-Reference with Public Databases

The Better Business Bureau keeps an exhaustive list of any and all complaints made against a business, whether they are a member or not. Most of this information is available online, free of charge, through the BBB website. Cross-reference any and all prospective services from the list above with the BBB database. Obviously, high numbers of complaints are a red flag, especially if the business has a low BBB rating or isn’t BBB accredited at all. Additionally, each state’s attorney general keeps a database of complaints. You might want to give them a call as well. The time and effort you put in at this stage of the game could be crucial to the fruition or failure of your debt-free dreams.

Understand The Services

Most legitimate credit counselors will give you some advice for free. Advice is all that you will get for free, though. They are a for-profit business, in most instances. If your problems are severe, the counselor may recommend that you participate in a debt management program (DMP). A form of debt consolidation, these programs are designed as a buffer between you and your creditors and potential bankruptcy. Unfortunately, they are limited to unsecured credit in most cases. They usually cannot help you with your mortgage or your auto loans. Additionally, the reduced interest rates and lower payments will negatively affect your credit score. The program will also cost you. You will have to pay an initial fee of around $50 plus 5-10 percent of your program payment. That portion is normally capped in the $50 neighborhood as well. Also keep in mind that non-profit credit counselors are not automatically more reputable than for-profit ones. Make sure to vet any service before you move forward with them, even if they are a non-profit.

Question Everything

You need to have plenty of questions answered before you sign up for any debt related program. Ask about the number of clients currently enrolled in a debt management program. It’s not necessarily a good sign if most of their clients are enrolled in one. A good mix is 50/50, because that shows the agency tries to help with other methods. Get clarification about the specific help that you will be getting. If that help does not include skills and tools to help you change the way you deal with debt, you could face the same issues in the future. Ask if their counselors are certified and by whom. Ask if the agency is accredited and by which agency. Ask what the program will mean to your credit history. The right answer is, “It’s hard to tell, but it could be negative.” The wrong answer is any attempt to brush off the question, or worse, telling you there will be no issues.

Shop Around

Finding the credit counselor that’s right for you is like everything else – you have to shop around. Make an apples-to-apples comparison by getting everything in writing: all services being offered for the quoted fees. Most towns have multiple credit counseling agencies and debt consolidators available, and bigger cities have a staggering array of options. If you can, speak with friends, coworkers, or relatives who have utilized a similar service to compare prices. The last thing you want to do is dig yourself deeper in debt by paying inflated fees to an ineffectual company!


Editor’s note: Jerry touches on some great points. When I was wallowing in credit card debt a reputable counselor helped me dig my way out. If you’re in this situation I would encourage you to follow the steps Jerry recommends.

Author Jerry Coffey is a recovering debtaholic, having spent many years in a debt-riddled gray area somewhere between broke and desperately broke before climbing out of debt through smart budgeting and frugal-living. Now he blogs over at, and you can read his personal story of becoming debt-free here.

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I'm the founder of Frugal Rules, a Dad, husband and veteran of the financial services industry. I'm passionate about helping people learn from my mistakes so that they can enjoy the freedom that comes from living frugally. I'm also a freelance writer, and would love to help out if you have the need. If you're wanting to learn how to monetize your blog, check out my blog coaching services to see how I can help you take your site to the next level.


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