YOUR CREDIT RESOURCE: Advice on what to look for in a credit counseling agency

Q: I'm thinking of going to a credit counseling agency for help with my finances. But I heard an ad on the radio from a debt settlement company telling people to avoid credit counseling agencies, because they are paid by credit card companies. Is that true?

A: Debt settlement, debt negotiation and credit counseling are lumped into the debt-relief industry, but the way each of these types of companies does business is very different. They all provide services to financially distressed consumers and therefore, they compete with each other. Debt settlement and debt negation companies are primarily for-profit. Most credit counseling agencies are nonprofit.


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