Success Strategies: Finding a Reputable Credit Counseling Company
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)
A network of agencies found nationwide, CCCS is a well-established and reputable organization whose mission is to provide financial counseling, financial education and debt management services. CCCS organizations vary by state and region. For example, you can find a region-wide CCCS for Southern New England (CCCS of Southern New England - www.creditcounseling.org) that serves Massachusetts, Connecticut and Rhode Island.
* Next 37 17 investors only!
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)
The Federal Trade Commission has an excellent website chock full of information for consumers, including how to choose a credit counseling service and the questions to ask when vetting an organization (see: http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre26.shtm)
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)
Consumers can get a list of HUD-approved counseling agencies by calling HUD at 800-569-4287 or by visiting HUD's "Tips for Avoiding Foreclosure" page at: http://www.hud.gov/foreclosure/index.cfm. On this page, you'll find a link for finding a housing counselor in any state across the U.S.
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)
Consumers can also check for any complaints against credit counseling agencies or companies by going to the Better Business Bureau website at: http://www.bbb.org. Type in your zip code to find the BBB for your state.
Questions to ask credit counselors
In addition to researching potential credit repair agencies and companies online, consumers should be prepared to ask a series of questions including:
- 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.
Did you like this article? You May Also Like:
 |
Feature Article: Three Common Mistakes New Investors Make - And How To Avoid Them
Sheila Farragher-Gemma, ForeclosuresMass, Corp.
Success in real estate investing requires a commitment to keeping emotions out of the picture. Anyone who has plunked down hard-earned savings or leveraged their good credit to fund a real estate investment...
|
 |
Investor Interview: The Reason Why I Do This!
Michael Ouellette
For Mike Ouellette, making money isn't the only answer, and it can be one of the biggest mistakes investors make when getting into the foreclosure market...
|
 |
Feature Article: Three Steps to Rebuilding Your Credit After Foreclosure
Stephen R. Elias, Attorney
Gone are the days when rebuilding one's credit history after going through bankruptcy or foreclosure was straightforward. With the crash of the sub-prime lending market, consumers are under intense scrutiny when applying for mortgages and credit cards, which means rebuilding credit can now take three to five years - or longer!. In his article, bankruptcy attorney and author Stephen R. Elias provides three key steps that you can pass on to your clients who need advice on how to recover from foreclosure.
|
 |
Finance Corner: A Good Fit: Real Estate in Your Investment Portfolio
Christopher P. Gullotti, MSFP
Financial planners hear comments about real estate investments frequently. Does investing in real estate truly offer financial opportunities? Many times yes, but not always for the reasons people think...
|
 |
Success Strategies: The Top Three Fears That Prevent You From Making that First Deal
Kelle Sparta
If you've yet to close on your first deal, it could be that something is blocking you. According to author, trainer, and coach Kelle Sparta, people usually have the following fears when it comes to real estate investing: they think they don't have enough information, they're afraid they'll lose money, or they believe they aren't the real estate investing type. Read her article to find out how to conquer these common, yet debilitating, fears!
|
 |
Nothing Succeeds Like Success: An interview with full time investor, Derek Ebrecht
Derek Ebrecht
Derek Ebrecht's got focus, drive and insight into what makes for successful investing. He's also got several profitable deals under his belt, despite his relative newness to the foreclosures field. We spent some time with Derek this month to understand the reasons behind his success.
|
 |
Interview With The Expert: Richard Cohen
Richard Cohen, Negotiation Coach and Consultant
For any real estate investor, negotiation is a part of everyday life. Whether with tenants, contractors or homeowners, any time you are trying to influence someone else, you are negotiating. This month we speak with Richard Cohen, a negotiation coach, consultant and real estate investor, to understand more about this critical skill...
|
 |
Feature Article: How To Protect Yourself In A Lease Purchase Deal
James A. Gage
Lease purchasing is when a potential seller transfers control of and rents a property to a potential buyer, until the buyer exercises his or her option to purchase the property. The benefits to both seller and buyer can be significant, however there are any number of factors which can derail the deal along the way. Jim Gage offers 11 practical tips for keeping things on track to the finish line.
|
 |
Feature Article: 1031 Exchanges - The Smart Way To Buy Investment Property
Jack Cutone
1031 tax deferred exchanges are an IRS approved method for selling property and reinvesting in another property, all the while deferring federal (and most state) capital gains taxes. It's a terrific arrangement, but not without it's complications. 1031 expert Jack Cutone explains how it works and, as importantly, what's required to make it happen...
|
 |
Feature Article: Five Strategies for Successfully Negotiating Short Sales
Elizabeth Weintraub
As any seasoned investor can attest, dealing with banks on short sales requires a large bottle of aspirin and the wisdom of Solomon. Real estate broker-associate Elizabeth Weintraub gives you the low-down on how to successfully deal with banks - everything from dealing with confrontational bank agents and writing contracts to proving to the bank why you're the best buyer.
|
