Increase in Consumer Debt Advice
by Ellise Walsh

Recent years have shown a huge increase in the amount of consumer debt that people are carrying. This increase had lead to just as large an increase in the debt advice available to help consumers who get in over their head.

The increase in consumer debt advice is a double edged sword, however. While there are excellent credit counseling services available that truly help consumers eliminate their debt while avoiding the difficult choice of declaring bankruptcy, there are also a number of shady operators who do not have the best interests of consumers in mind.

Unfortunately, these shady operators in the debt advice business make doing business all the harder for the honest operators in the industry. It is often difficult for the average consumer to tell the good operators from the bad when seeking debt advice.

One of the best things to do when seeking help to consolidate and eliminate your debt is to sit down and write out everything you owe. Make a spreadsheet showing how much you owe on each bill, to whom you owe it, and your monthly payments. Then write out all your sources of income and determine how much you have available.

If the monthly shortfall is relatively small, you may be able to deal with your debt by taking on a part-time job until you can pay off the debts you owe. If the shortfall is too large for you to close the gap with a part time job, you may need to seek debt advice.

Before you seek outside debt advice, however, you may want to try to help get yourself out of debt. Calling your creditors is a good way to start. Many creditors are willing to work with you and may be willing to lower your interest rate, your monthly payments, or both to help you pay off what you owe. This is not a program the credit card industry likes to advertise, but they are often willing to work with their customers to help them pay off their debt. After all, the last thing your credit card company wants is for you to be forced into bankruptcy.

If you are able to negotiate terms with your creditors, be sure that you make the payments you have agreed upon month after month, and on time. If you are late with your payments, or if you fail to make a payment altogether, your creditors may call off the repayment schedule and demand payment in full.

If you cannot negotiate with your creditors on your own, or if you feel uncomfortable doing so, you may need to seek outside debt advice. Be sure that the company you choose can provide you with references from former customers, and be sure the company has a good rating with the consumer advocacy organizations in your area. Be prepared with a list of everything you owe, and proof of your income, when you go to the initial consultation meeting.

Be sure that you read all your paperwork thoroughly before you sign anything. Never sign any paperwork that contains blanks, and be especially cautious if the credit counseling service provides you with blank forms and says they will fill them in for you. Above all, if you feel uncomfortable, move on to another credit counselor. You relationship with the provider of debt advice will likely be a long term one, and you will want to make sure you choose a company you can work with.

With debt rates rising at a steady rate, and personal savings rates at their lowest point in history, the increase in consumer debt advice is likely to continue to rise. If you find yourself in need of debt advice, be sure to shop around for the best place.

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