What Fees Do Credit Counseling Services Charge?

Before you sign up for credit counseling services, it is important to learn what fees they charge and how those fees are paid. Avoid a service which charges large up-front fees. Don't be put off by a service which collects a commission from your credit card company or other creditors for managing your debt, but be wary of one which will take a big slice of your monthly payment to cover its commissions even before it services your debts.
Some services suggest that it is better to work with a service which charges you a large fee, rather than deriving the bulk of its fee from discounts and rebates from your creditors. Keep in mind that creditors work voluntarily with credit counseling and debt management companies, and are paying any fees or rebates voluntarily. Also, some firms which charge you a great deal of money will still attempt to collect rebates from your creditors to fatten their fees.
You should request that your credit counseling service provide you with monthly statements for their debt management plan, reflecting the amount you paid in, the dates and amounts they paid to each of your creditors, and the amount of their fees.

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