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Choosing Credit Counseling Firms

March 18, 2001

Questions consumers should ask before choosing a credit counseling firm, according to the National Foundation for Credit Counseling. New bankruptcy overhaul legislation passed by the House and Senate would require people to participate in a counseling program before filing for bankruptcy protection:

_Is the credit-counseling organization not-for-profit? How is it funded? Is it accredited by any outside agencies?

_What training do counselors receive? Are they certified?

_How is money dispersed to creditors? What policies are in place to ensure protection of clients’ funds?

_What fees, if any, will I be charged? Will the counselors work with all my creditors, regardless of whether they financially support the organization?

_Is confidentiality assured?

_Can I receive counseling in person or over the telephone, whichever I prefer?

_What effect will working with the organization have on my credit rating?

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On the Net:

National Foundation for Credit Counseling: http://www.nfcc.org

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