Credit-Counseling Service
Nonprofit consumer credit-counseling agencies may consolidate your debts into a single, manageable monthly bill. You pay the agency each month and they distribute the money to your creditors. This type of arrangement is not a consolidation loan, but it has its benefits because creditors will often accept lower payments if you're working with a reputable credit-counseling agency. Services may be free or provided for a very low fee of $10 to $15 a month.
Counselors are trained in helping consumers get out of debt and will work with you to get late fees waived and interest rates reduced. You may have to agree not to use credit and not to apply for new credit while you're participating in the debt repayment program.
Won't credit counseling hurt my chances of getting credit?
It may, but don't let this keep you from getting help. Repayment programs through credit-counseling agencies show up on your credit history, but by the time you're in deeply enough to consider consolidation loans, your credit rating has probably already been affected.
