Credit Counseling

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In the wake of the recent subprime mortgage crisis, more people are turning to credit counselors to take stock of their finances. These counselors train their clients in financial management and planning. They teach customers to especially work on improving their credit score, since an excellent score will provide them more opportunities for bank loans. Credit counselors also assist people who are experiencing financial dilemmas by scrutinizing their current budgets to pinpoint trouble spots. They offer an objective eye to clients who may be blind to their personal destructive spending habits.

Credit counseling jobs essentially function as finance jobs in counseling. Credit counselors have deep knowledge of finance and what constitutes a stable financial profile. They are trained in debt management, mortgages, leases, financial aid, and budget preparation. They use the latest debt-management software to present clients’ finances as vividly as possible, and describe how clients can increase their finances by executing certain actions.

Besides acting as financial experts, credit counselors perform customer-service jobs for their clients. They listen carefully to each client’s financial report and apply their financial knowledge to determine the best strategies to leverage that client’s finances. Oftentimes, they recommend clients to write out budget spreadsheets that detail daily, weekly, and monthly expenses. After the client does this, the client and the counselor decide on areas that entail unnecessary spending, which the client should immediately cut. Just by taking this simple action, the client may save hundreds more dollars to put in the bank.



Credit counselors also focus on their clients’ credit-card debt, which they try to alleviate through debt-repayment plans. Many Americans are thousands of dollars in debt to credit card companies. In most cases, this is because they over use their credit cards in lieu of cash to pay for expenses. These expenses may include restaurant meals, clothing, and other shopping. Americans are often so in debt because they are deluded by credit cards’ intangible value, in contrast to cash, which acts as cold, hard evidence of expenses.

In response to credit-card debt, credit counselors often recommend clients to cancel certain credit cards, such as retail credit cards, and to pay them off. After this, they recommend clients to devote huge efforts to repaying their credit-card debt. They specifically urge clients to use their credit cards much less to enable them to pay their credit-card bills off earlier. Paying debts off early will help clients boost their credit scores, which are so necessary for bank-loan eligibility. Moreover, counselors inform their clients that maintaining excellent credit scores will make them eligible for lower interest rates on their cards. Yet another benefit is that less compounded interest accrues when paying off bills early, so the overall total spent is lowered.

Furthermore, many credit counselors directly contact credit-card companies and ask for their clients to receive reduced interest rates in order to pay their debts off more easily. However, these credit counselors may often be working for the credit-company itself, which is always a red-flag situation for clients. Yet, credit counselors also work for counseling firms, government, and non-profit organizations that offer many free educational programs to clients. As a rule of thumb, the most reputable credit-counseling agencies are affiliated with the National Foundation for Credit Counseling. Legitimate counselors also make no promises that they can magically remove all a client’s debt. They set clear expectations that what they can offer are learning tools, financial education, and proven strategies that can certainly reduce debt if a client puts these strategies into practice.

Many credit counselors are particularly skilled in certain financial subjects. For instance, there are mortgage counseling jobs in which counselors help clients negotiate the difficult process of determining a payment plan for a new home. These counselors educate their clients on the mortgage interest rates that best fit their budget. Today, however, they may tell clients point-blank that it is a better idea to reconsolidate finances before purchasing mortgages, since banks will be more discriminating of mortgage-seekers due to the recent subprime mortgage crisis.

Besides consulting clients on purchasing new homes, mortgage counselors may also help people who are falling behind with their mortgage payments and need refinancing options. Mortgage counselors also give advice on reverse mortgages, renting, foreclosure, default, and other credit issues. Mortgage counselors are often affiliated with banks, with the most legitimate counselors working for non-profit agencies certified by the U.S. Department of Housing and Urban Development (HUD).

Other credit counselors are trained in financial problems related to divorce, bankruptcy, college funding, and medical funding. They may direct clients to government-funded loans and other financial-aid programs they may not know about.

Since so many people never learn good financial education, they leave credit-counseling feeling much more in control of their finances. Furthermore, many credit counselors work irregular hours on hotlines so their clients can reach them during any financial emergencies. In addition, many credit counselors offer online programs for clients who may not be able to attend sessions in person.

Those wanting to break into credit counseling jobs amass a huge amount of financial knowledge in college. Throughout their education, credit counselors hone this knowledge and their customer-service skills. They practice clear communication skills so they can break down complex financial issues to clients. Many of them also become fluent in Spanish to communicate with the ever-expanding Spanish-speaking population.

Job opportunities for credit counselors will rapidly advance in the next decade. More people are realizing the downfalls of their spending habits and want to find a way out of debt. The best job opportunities will likely go to counselors who have achieved master’s degrees, have at least two years of counseling experience, have counseling licensure or certification, and speak Spanish. On average, credit-counseling jobs pay about $16 an hour, with highly experienced counselors earning about $18 an hour.
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