When you find yourself thinking about using a credit counseling service, you need to be very careful. You need someone who will help you, not just some pushy sales associate who wants only to sign you up for their service.

The debt industry has grown dramatically as the American consumer has taken on an increasing load of debt. This increased competition for the debt dollar has attracted some charlatans to the industry. You need to be very careful you know with whom you are dealing.

You are about to place your financial life in someone else’’s hands. Make sure you have the answers to some questions before you do. Then make sure you like the answers to your questions. Here are some for starters:

Is the counseling agency affiliated with major industry groups? There are two major debt industry groups, The National Foundation for Credit Counseling and the Association of Independent Consumer Credit Counseling Agencies Affiliation with one of these is no guarantee you have a good agency but these groups do have a set of standards which need to be followed, so it is a start.

Are there large up front fees? The credit counseling agency will usually charge a small fee to set up your account. They then will charge a fee to administer your plan each month. If a large fee is required to begin your plan, watch out. Some companies have charged large up front fees and then disappeared with the clients money. You need to be sure the money you are paying is going to your debts and not being syphoned into the pocket of your credit counselor.

Can you really do that for me? Some credit counseling agencies make unrealistic promises. If statements made seem too good to be true, you need to pin them down. Settling your debts for little money or without harming your credit rating are not realistic. If they insist they can, ask for the promises in writing. Chances are they will not be willing to do this if they cannot deliver. If they do put it into writing, at least then you will have something to use for evidence if legal action becomes necessary.

Which of my creditors have you worked with in the past? You have a list of your creditors. You want to compare it to the creditors they have worked with in the past. Have they been successful working with your creditors in reducing payments,lowering interest, and eliminating fees? You need to know not all creditors will work with credit counselors. If all, or most, of your creditors have, or will, you should investigate these services further. If not, credit counseling won’’t do you much good. To protect yourself, ask for a list (in writing) of any of your creditors they have worked with in the past.

Will my creditors be paid on time each month? Two things come into play here. What are the due dates of each creditor and when during the month do you get paid? Nothing defeats the purpose faster than paying a creditor late, after you have set up a new payment schedule. Some credit counseling services use a set date each month to make payments from the money you have given them. If they don’’t have your creditors change the due date you could be socked with late fees each month. Find a service that adjusts the due dates of your bills to work around the days you get paid.