I was researching using Credit Counseling Services (mine would be Take Charge America to be specific) and came across your blog from 2000. I have to be honest, the blog scared me. My husband I have great credit, both with scores in the mid to upper 700’s. We purchased a home last year (a major fixer), and then accrued considerable credit card debt “fixing” the home. Sadly, I lost my job last month, and we have now realized that within the time of a couple months, we will not be able to pay our credit card debt. Our credit card company referred us to Take Charge America and it seemed like a good idea. However, after reading your blog about CCCS I am very concerned about the effects to my credit and credit report. I understand the blog is a little old-from 2000, but is that still accurate? Please hep!
Here is the OLD BayHouse credit counseling page: Consumer Credit Counseling – Debt Negotiators
I haven’t updated the BayHouse site in a long time, but most information is still accurate. While the “credit counseling” notation is no longer rated as derogatory for FICO scores, late payments and delinquent accounts of course ARE impacting negatively on your credit rating.
Your credit card company referred you to Take Charge America because they are their COLLECTOR. Credit counselors only charge about 10% of the money they collect for creditors because they don’t have to track you down and harass you into paying your debts – you VOLUNTEER. All they need to do is accept your payments, take their cut and forward the rest to the bankers.
Here is a documentary about another “non profit” credit counseling nightmare:
However, I DO recommend that you set up an appointment with Take Charge America and get their recommendations.
They SHOULD explain your options to you, including bankruptcy and simply defaulting on your debts.
Based on the information I have, it is very likely that you could discharge your debts through bankruptcy and you really NEED to save every dollar to KEEP your home.
Or, you could simply stop making payments on your unsecured debts if you are judgment-proof, which you might be. In that case, you may have to change your phone number because the creditors’ harassment calls have literally driven people to commit suicide — they have no mercy. So if creditors have your home phone number, don’t make any more payments to them and use what little money you have to get a new UNLISTED phone number.
If credit is important to you, bankruptcy is the best choice and it will also stop collection efforts.
I had clients who qualified for the lowest fixed mortgage rates only two years after discharging their credit card debt and they bought a home. FICO scores CAN be over 700 two years after the bankruptcy filing with some PLANNING.
It’s MOST important that you get all your OPTIONS and set up a couple of FREE consultations with bankruptcy attorneys.
Make an INFORMED decision.
You have NO moral or legal obligation to pay your debts to banks. They are run by CRIMINALS and they deceive, defraud and even STEAL account holders’ money every chance they get.