Because debt has become such a huge problem within America, Credit Counseling Services have popped up all over. These services, the better of which are free, are designed to help get people out of debt.
How Credit Counseling Services Work
Once you sign up to use a Credit Counseling Service, they begin calling around and negotiating new payback terms with your creditors. This usually results in lower interest rates, but also in closing an account. No creditor, after all, is going to give you little or no interest so you can get out of debt, and then allow you to take advantage of that by spending more.
Once the Credit Counseling Service negotiates terms for payback, they begin a payment system with you. This means that, instead of sending separate checks each month to several different creditors, you will send one check directly to the Credit Counseling Service. This money goes into a trust account and then the Credit Counseling Service pays your creditors for you.
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By Christy Patrick
