Purpose

• The purpose of using a debt counseling service is to get out of debt when you cannot do so on your own. Debt counselors offer knowledge, resources and assistance ranging from referring you to educational materials or classes to working with your creditors on a special repayment plan administered by the counseling firm. Good debt counseling services personalize their recommendations for you rather than relying on structure payment plans for all cases.
  
  

Selection

• Debt counseling services work with clients face-to-face, online or on the phone. You can find a debt counselor in your area, or one who can work with you long distance, through your credit union, bank, local college, U. S. Cooperative Extension branch or the National Foundation for Credit Counseling. Ask if the firm has the required licensing to work with people in your state, the Better Business Bureau advises, and check its BBB rating. Inquire about its funding sources if it is not for profit, as it should rely on creditor contributions rather than client-paid fees. Choose a counseling service that puts its contracts in writing, including what it provides to you and how much it charges.
  
  

Process

• You meet with your credit counselor, either in person or via a phone call or Internet chat, once you agree to work with a debt counseling service. Gather all your financial information, including pay stubs, bills and an expense list, prior to the meeting as the counselor needs to know details of your current financial state to make appropriate recommendations. The counselor asks questions, discusses the situation and gives you options, such as budget development help, classes or a debt management plan. You may be identified as a bankruptcy candidate if your finances are dire.
  
  

Time Frame

• Debt counseling offers solutions you can implement quickly. For example, the counselor might make a new budget with you or refer you to a financial management seminar. It takes time to get rid of your debt because you must stay on your new budget or use the new financial strategies you learn. Repayment plans administered by debt counseling firms usually take three to four years to eliminate your bills, according to the Bankrate financial site, as long as you never skip payments.
  
  

Success Rate

• Over three million people sought debt counseling services in 2008, according to the National Foundation for Credit Counseling, and the counseling session allowed one-third of them to handle their financial problems on their own. One-third of the clients entered repayment plans, and one-third had problems too severe to be handled by counseling and structured plans.