How to Get Free Credit Counseling in Alaska
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There are some simple steps that you can take to find and get the most out of free credit counseling in Alaska through a reputable nonprofit credit counseling organization. We will begin by helping you find a reputable consumer counseling service, help you feel confident in your selection by sharing good areas to research in advance and questions to ask before you go, as well as what to expect from your credit counseling session and what steps may follow.
Written by Attorney Eva Bacevice.
Updated November 30, 2019
Even though living in Alaska may sometimes feel a little off the grid, nowhere is immune from financial problems. There are plenty of people in Alaska who are having trouble maintaining their bills or struggling with debt just like in the rest of the United States. Credit counseling might be a good solution for Alaskans with money management issues. Credit counseling through a reputable nonprofit agency will give someone a chance to meet one-on-one with a certified credit counselor to conduct a thorough review of their finances and recommend the best next steps. Financial counselors at these agencies are usually certified or trained in three areas: consumer credit, money and debt management, and budgeting. By taking the time to sit down with you and discuss your circumstances as well as your financial goals, they can recommend a personalized plan to help you out of a bad situation. They can also help introduce tools and suggestions, through educational materials and/or workshops, that can help you develop good financial habits moving forward. Credit counseling services could be helpful for you if you are behind on debt repayment, but it might also help if you are struggling to maintain your payments that are still current. It is important, however, to learn how to recognize the reputable nonprofit credit counseling agencies from for-profit companies who might not have your best interests at heart. There are, unfortunately, too many predatory companies out there who will try to take advantage of people already in dire financial straits by promising quick solutions to get rid of debt that is unlikely to work and will likely make the whole situation even worse. In this article, we will go over how to the right consumer credit counseling services to help get you back on track, as well as any red flags to look out for.
How to Get Free Credit Counseling in Alaska
There are some simple steps that you can take to find and get the most out of free credit counseling in Alaska through a reputable nonprofit credit counseling organization. We will begin by helping you find a reputable consumer counseling service, help you feel confident in your selection by sharing good areas to research in advance and questions to ask before you go, as well as what to expect from your credit counseling session and what steps may follow.
Find Alaska Nonprofit Credit Counseling Agencies
The first thing to help you find a good credit counselor in Alaska is to limit your search to nonprofit organizations that offer debt counseling. Now it is important to note that simply being designated as a nonprofit is not enough to ensure that you are in good hands. Further steps you can take include checking if the Alaska credit counseling service is certified by the National Foundation for Credit Counseling, or NFCC. You can also use online resources to make sure that the Alaska credit counseling service you are considering will have your best interests in mind. One easy trick is to request educational materials before scheduling an appointment. Any reputable Alaska credit counseling nonprofit will send these materials for free, without asking you to disclose any personal information. If the credit counseling agency asks for either money for materials or personal information in exchange that is a big red flag. You also want to focus on Alaska credit counseling organizations that offer a range of services, not just debt settlement, which is costly and rarely successful. You may also want to see what options for meeting the Alaska credit counseling agency offers: is it simply online or over the phone? Or is there an option to meet in person?
Information to Research Before Talking to an Alaska Credit Counseling Agency
When you have narrowed the choices down to a few Alaska credit counseling organizations you can check with the Alaska attorney general’s office, specifically, the local consumer protection agency called the Alaska consumer protection unit, to see if they have received any complaints about any agency on your list. You can also run the Alaska credit counseling agency names through the Better Business Bureau to check for complaints and verify their rating. Ideally, you want to find a certified Alaska credit counselor at a reputable nonprofit credit counseling organization that is accredited by the NFCC’s high standards, offers a wide range of services, with no complaints filed against it and that has a high rating from the Better Business Bureau.
Questions to Ask the Alaska Credit Counselor Before Signing Up
Once you are confident that the Alaska credit counselor is part of a reputable nonprofit organization there are still questions to ask in advance to make sure the credit counseling program is a good fit for your financial goals. You should always verify that the initial session is free. Beyond that, there are some recommendations (a debt management plan in particular which we will discuss in more detail later) that could include either a setup fee, monthly fees or even both that are legitimate costs. You can request to find out about the cost structure before you set a foot in the door. You can request to get this in writing, and may also want to ask how the Alaska credit counselors are compensated. If it turns out that they receive bonuses or incentives for signing people up that is another red flag to avoid. If you have concerns about whether you could afford any costs you can ask what options they have in those circumstances. As mentioned above you can absolutely ask for educational materials to be provided in advance to get a better handle on the financial education services that are offered. You should feel free to ask any questions you need to feel comfortable with your choice. That might also include how long a session will take, what you documents you should bring to get the most out of it, and what resources they offer to help you avoid financial problems in the future.
What to Expect During Credit Counseling?
During your Alaska credit counseling meeting, you can expect to meet one-on-one with a financial counselor. Typically a certified Alaska credit counselor is trained in consumer credit, money and debt management and budgeting. The session will run from a half-hour to an hour, and at that time the counselor will go over your financial circumstances in depth. They will look over your income, bills, and debts. With your permission, they will help you obtain your credit report and your credit score to get an accurate picture of your current situation. They will discuss with you your financial goals, whether that includes debt relief or learning better habits for personal finance. At the end of the meeting, they will go over a personalized plan for you, including the next steps. This may include additional sessions or financial education workshops. Most typically the plan will be for either debt consolidation, a debt management plan or bankruptcy, whichever makes the most sense for your circumstances.
What Happens After Credit Counseling in Alaska?
After you complete your credit counseling in Alaska, chances are you will be moving forward with one of the three likely recommendations: debt consolidation, a debt management plan or bankruptcy. Below we will look into each option in more depth to get a better sense of what each entails.
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Alaska Debt Consolidation
Debt consolidation usually involves taking on new debt to pay off your existing debts. This can be highly effective if your bills are made up of a lot of credit card debt with high-interest rates and you have a decent credit rating. Presuming you qualify for a loan with a lower interest rate you can pay off your existing debt and going forward only need to make a single monthly payment on the rest which will save a lot of interest. There are potential downsides, however, in that you are increasing debt to address debt, this doesn’t offer any tools to avoid getting into financial problems in the future, doesn’t address other kinds of debts like student loans or medical bills, and is only effective if you qualify for a lower interest rate on any new debt.
Alaska Debt Management Plan
A debt management plan is a way to modify your monthly payments based on a budget you create with your financial counselor and a possible reduction in payments that the counselor can negotiate on your behalf with creditors. In addition to potentially lowering the interest rate or payment, they may relax late fees. With a debt management plan, you will make a monthly payment to your Alaska credit counseling agency and they will pay all of your bills for you based on whatever agreements they made with your creditors. This does not involve taking on any new debt as debt consolidation, however, you will need to close all credit cards but one for emergencies, and if you miss a payment the entire plan might be void.
Alaska Bankruptcy
If you can’t afford to maintain your bills with a consolidation or payment plan your financial creditor may recommend bankruptcy counseling. Bankruptcy is a legal remedy that exists for people, or companies, who are underwater financially and offers an opportunity to walk away from some (or all) of their debt. You can learn more about bankruptcy in Alaska through Upsolve. If this is the path you choose to take, you can see if you qualify to partner with Upsolve for free to help walk you through the bankruptcy process step by step.
