Debt Counseling Services can Improve Credit Scores

Are you finding it difficult to stay ahead of your debt? If your debt is becoming a problem then you might want to look to debt counseling services. These services will provide you with many ways to manage your debt and they can help you overcome your financial problems with expert advice. Don’t let your late payments pile up and ruin your credit score. As Canadians, we have many options for help. Here’s how debt counseling can help you.

Why Would I Want Debt Counseling?

The main reason to use debt counselling is to manage your debt in the best way possible. Another reason is the fact that debt is quite stressful and the mounting bills might be more than enough for you to bear. In fact, when you start to miss bill payments, it will have a huge negative impact on your credit score that could last for many years. You will end up finding it difficult to get loans in the future.
When you are in debt you can also suffer from depression and you can’t lead the life that you want. Debt counselling will address these issues and help you solve your debt problems ina way that works for you and your individual needs. According to Gail Vaz-Oxlade, the host of hit TV show, Princess and Til Debt Do Us Part, people don’t want to stay in debt, but it’s up to you to realize that you have a debt problem. Gail offers some advice to in helping to figure out Why are you in debt? The sooner you are manage your debts, the sooner you can start improve your financial health.

What Does Counselling Offer Me?

Debt and credit counsellingGail-Vaz-Oxlade offers you a one on one session with a trained expert in debt related matters. These experts work with you to find solutions to your debt problems. They will find payment options that make it easier for you to manage debt and get it paid for as quickly as possible

  • You’ll most likely be put in a debt management program where you’ll manage your debts with a monthly payment that works for you and your income limitations.
  • The counselors will work with your creditors so the debt is smaller and more practical so you have lower payments and a reduction in the interest. It’s often the interest on debt that makes it so difficult to pay the debt back not the actual principal you owe.
  • You’ll learn about rebuilding your credit and how to fix the poor credit you may have now. The counselors will also teach you about budgeting and how to live free of debt for good.

The counsellor is there to help you deal with your debt issues and to make it easier to pay off your existing debts. You need a third party between you and your creditors. These experts understand how debt works and how to work with creditors to reduce payments so your debt free in less time. The counselor is there to help you manage your money and not take it away from you like the creditors do with their high interest payments and fees on your existing debt load. They will speak with your creditors and work to get longer-term payment plans for you to work with. This will reduce the monthly financial burdens you have because the payments will be smaller.

Improve your credit scores

The more missed and late payments you have, the deeper you fall into bad credit territory. As more and more bills pile up, it will become harder for you to catch up on your payments. This is typical of a person who is running into debt issues. While you are trying to figure out how out to pay your bills, your credit score will also suffer. Stop the bad credit spiral immediately by having a debt counselor work with the creditors and debt collections agencies.

In most cases, they will be able to come up with an agreement to help management your credit history. While on debt counseling services, you credit score will have an R7 rating, which means that you are making regular payments through a counseling service. This is better than having a bankrupcy claim on your credit report. When have completed payments, you can show future lenders that you have made an effort to pay back your debt through regular monthly payement. In 2 short years after you complete a debt management plan, it is typical that a person can bounce back to a score of 600+ – relatively a good credit score.

Less Stress on You

When you work with these services you’ll have less stress and the ability to manage your debt will be much easier. These professional counselors are there to help you understand your debt and they will work to ensure that the debt is easier for you to manage. Usually Canadians who sign up for debt counseling will be debt free in 3-5 years and will be well on their way into improving their credit profile. If you need help with debt issues then a debt counselling service is the way to go.

About the Author ()

Pat Drummond is the author of Credit Reports Canada and considered by many to be one of the leading experts on productivity and simplicity in relation to financial planning. He started this online credit score & reporting site to chronicle and share what he’s learned in over 20 years of counseling families and individuals on debt management, obtaining loans and improving credit scores.

Leave a Reply

Your email address will not be published. Required fields are marked *