5 Questions to Ask a Credit Counselor

Quick Answer

The first time you meet with a credit counselor, you should ask them questions to determine if they’re accredited and nonprofit, what services they offer, what fees they charge and how credit counseling will impact your credit.

Portrait of a smiling asian woman with crossed arms against a dark background.

If you're struggling to manage debt, swamped in the stress of multiple credit card bills and straining to afford other expenses, a credit counselor may be able to help. Credit counseling can help you manage your finances and navigate the process of getting out of debt.

But trusting a credit counseling agency to help you unpack your financial difficulties and regain control of your cash flow and debt is a big choice. For starters, you'll want a nonprofit, accredited credit counselor, but there's more to consider. It's important to be sure that the person you work with is an expert with your best interests in mind before you agree to work with them—or hand over any information about your finances.

Ask a credit counselor these five questions to determine whether they're the right fit for you.

1. What Are Your Accreditations?

You should only consider working with a credit counselor who has certifications that prove they're qualified to help you improve your financial situation and overcome debt.

The easiest way to find an accredited credit counselor with the expertise you need is to go through an agency accredited by the National Foundation for Credit Counseling (NFCC), an organization that exclusively works with nonprofit counseling agencies, or the Financial Counseling Association of America (FCAA), which works with both nonprofit and for-profit agencies that meet its high standards of service.

2. Is Your Service Nonprofit?

Working with a nonprofit credit counseling agency provides you some assurance that the person you're working with has the best of intentions in mind. So before you go any further in the process, verify that the counselor you're speaking to belongs to a nonprofit agency.

Nonprofit credit counselors are required to put your interests first. That means that they'll recommend the best options for you, rather than push you into services that come with fees. For services that do cost money, nonprofit rates tend to be lower than rates for the same services at a for-profit credit counseling agency.

3. What Do You Offer Besides Debt Management Plans?

One red flag to look out for is a credit counselor who pushes a debt management plan as your only option. Debt management plans, in which the credit counselor negotiates with your creditors to reduce your interest rates and fees and you make a single payment that goes to your creditors every month, can be very helpful when you are facing a mountain of credit card debt. But they're not right for every situation.

If a credit counselor also steers the conversation exclusively toward debt settlement without understanding your full situation first, it's probably best to look elsewhere for help. A credit counselor whose priority is helping you improve your financial situation should offer you a range of alternatives tailored to the specifics of your situation.

4. How Much Does It Cost to Work With You?

Your first meeting with a credit counselor should always be free. During that meeting, you should receive information to help you assess your current financial situation, create a budget plan and begin managing debt. A good credit counselor won't ask you to pay for information.

Other, specific services may come with fees, so be sure to ask your counselor about various options and their costs upfront. For instance, a debt management plan typically comes with relatively low upfront and monthly service fees.

5. How Will This Impact My Credit?

Before you commit to a strategy for getting on top of debt, ask what impact you'll see on your credit. A good credit counselor should be able to tell you what will happen to your credit score while you work together.

For example, entering into a debt management plan can impact your credit. Over time, getting out of debt will help your credit, but you'll likely also see a reduction in your credit score if you opt for a debt management plan, as creditors typically close those accounts as part of the agreement. Doing so will decrease your available credit and can impact your credit utilization ratio and the age of your accounts, though it's still a better option than debt settlement or bankruptcy.

Ultimately, the impact to your score will vary based on where your score is at right now and the specifics of your current debt situation.

The Bottom Line

When it's the right choice for you, credit counseling can be a powerful way to regain control of your finances and get out of debt. But it's also vital to only work with a credit counselor with the right accreditations and who offers services tailored to your financial challenges. Asking the right questions upfront can help you screen potential counselors to find a good match.

Whatever course you take out of debt, start monitoring your credit for free through Experian to see where you stand first. You'll get a clear look into how your balances and payment history are helping or hurting your score, plus see your efforts to get out of debt pay off in real time.

How Good Is Your Credit Score?

300 credit score301 credit score302 credit score303 credit score304 credit score305 credit score306 credit score307 credit score308 credit score309 credit score310 credit score311 credit score312 credit score313 credit score314 credit score315 credit score316 credit score317 credit score318 credit score319 credit score320 credit score321 credit score322 credit score323 credit score324 credit score325 credit score326 credit score327 credit score328 credit score329 credit score330 credit score331 credit score332 credit score333 credit score334 credit score335 credit score336 credit score337 credit score338 credit score339 credit score340 credit score341 credit score342 credit score343 credit score344 credit score345 credit score346 credit score347 credit score348 credit score349 credit score350 credit score351 credit score352 credit score353 credit score354 credit score355 credit score356 credit score357 credit score358 credit score359 credit score360 credit score361 credit score362 credit score363 credit score364 credit score365 credit score366 credit score367 credit score368 credit score369 credit score370 credit score371 credit score372 credit score373 credit score374 credit score375 credit score376 credit score377 credit score378 credit score379 credit score380 credit score381 credit score382 credit score383 credit score384 credit score385 credit score386 credit score387 credit score388 credit score389 credit score390 credit score391 credit score392 credit score393 credit score394 credit score395 credit score396 credit score397 credit score398 credit score399 credit score400 credit score401 credit score402 credit score403 credit score404 credit score405 credit score406 credit score407 credit score408 credit score409 credit score410 credit score411 credit score412 credit score413 credit score414 credit score415 credit score416 credit score417 credit score418 credit score419 credit score420 credit score421 credit score422 credit score423 credit score424 credit score425 credit score426 credit score427 credit score428 credit score429 credit score430 credit score431 credit score432 credit score433 credit score434 credit score435 credit score436 credit score437 credit score438 credit score439 credit score440 credit score441 credit score442 credit score443 credit score444 credit score445 credit score446 credit score447 credit score448 credit score449 credit score450 credit score451 credit score452 credit score453 credit score454 credit score455 credit score456 credit score457 credit score458 credit score459 credit score460 credit score461 credit score462 credit score463 credit score464 credit score465 credit score466 credit score467 credit score468 credit score469 credit score470 credit score471 credit score472 credit score473 credit score474 credit score475 credit score476 credit score477 credit score478 credit score479 credit score480 credit score481 credit score482 credit score483 credit score484 credit score485 credit score486 credit score487 credit score488 credit score489 credit score490 credit score491 credit score492 credit score493 credit score494 credit score495 credit score496 credit score497 credit score498 credit score499 credit score500 credit score501 credit score502 credit score503 credit score504 credit score505 credit score506 credit score507 credit score508 credit score509 credit score510 credit score511 credit score512 credit score513 credit score514 credit score515 credit score516 credit score517 credit score518 credit score519 credit score520 credit score521 credit score522 credit score523 credit score524 credit score525 credit score526 credit score527 credit score528 credit score529 credit score530 credit score531 credit score532 credit score533 credit score534 credit score535 credit score536 credit score537 credit score538 credit score539 credit score540 credit score541 credit score542 credit score543 credit score544 credit score545 credit score546 credit score547 credit score548 credit score549 credit score550 credit score551 credit score552 credit score553 credit score554 credit score555 credit score556 credit score557 credit score558 credit score559 credit score560 credit score561 credit score562 credit score563 credit score564 credit score565 credit score566 credit score567 credit score568 credit score569 credit score570 credit score571 credit score572 credit score573 credit score574 credit score575 credit score576 credit score577 credit score578 credit score579 credit score