By Robert Giuliana

Consumers who have gone through foreclosure need real financial help - primarily in learning how to repair their damaged credit and how to better manage their finances in the future. Based on the feedback I've received from consumers after they've read my book, Save that Mortgage!, consumers do not know how to help themselves when it comes to personal finance.

The one question I've heard repeatedly is, "How do we find a reputable company to help us repair our credit?" For you real estate investors who wish to help people either facing foreclosure or who have gone through foreclosure, the following resources will provide you and your potential buyers with plenty of free information on finding reputable credit counseling agencies.

Consumer Credit Counseling Services (CCCS)

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Depending on the state, CCCS organizations offer debt management programs at no charge, or they charge a nominal monthly fee or both. Working with the consumer, CCCS will develop a debt repayment plan, which usually includes reduced credit card payments, and will call all credit card companies on behalf of the consumer to implement the repayment plan. The consumer then sends CCCS a check for a set amount each month and CCCS makes the credit card payments. Although consumers can do this for themselves, CCCS is generally much more effective at it because they know who to talk to at the banks and how to get the payments and/or interest rates reduced.

Caveat: Just because a credit counseling organization says it is non-profit doesn't mean its services are legitimate.

Facts for Consumers (FTC)

In addition, it includes the warning signs to look for if a company offering to repair your credit approaches you. Due to the current market, companies are marketing themselves to consumers with poor credit histories by saying they can clean up any type of credit problem, erase bad credit, remove bankruptcies and foreclosures, and even worse, create new credit IDs legally!

As the FTC site states, these pitches are scams, pure and simple. For additional information on how you can help your clients, see: http://www.ftc.gov/bcp/conline/pubs/credit/repair.shtm

U.S. Department of Housing and Urban Development (HUD)

Caveat: Although HUD vets counselors, in our research we found a few that definitely were not up to par. Consumers are cautioned, then, to practice due diligence and not choose a counselor simply because he or she has been recommended by HUD.

Better Business Bureau (BBB)

Questions to ask credit counselors

• How do you make your income?
• What do you charge for your various programs?
• How long have you been in business?
• This is my situation - is this something you deal with on a regular basis?
• Are you a member of the BBB? Do you mind if I call the BBB to see what your record is? (If the company hesitates, consider this a red flag.)
• What is your process for helping people manage their financial problems?
• Do you offer financial counseling and education?

And finally, consider it a red flag if a credit counseling company calls you or your customers about repairing bad credit. If they call or email you, this means they have paid a substantial fee to purchase a list of people with financial problems and need to earn back their investment.

Also, encourage your customers to determine their true financial status in detail. This should include all living expenses and income as well as all assets and liabilities. Having this information will help a financial counselor to give more accurate and helpful recommendations. Forms to help in this analysis can be found in my book, Save that Mortgage!, and are also available at financial institutions and online.

Robert Giuliana, a mortgage professional for many years, decided enough was enough: people had to clearly understand what to do at various stages in the foreclosure process, so he wrote the book, Save that Mortgage!, which is available on Amazon. Based in Maine, Robert can be reached by phone at 207-773-1656 or by email at robertgiuliana@gmail.com. You can also learn more about his book at: www.savethatmortgage.com.

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