How to Get Free Credit Counseling in Arizona

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Written by Eva Bacevice, Esq..  
Updated November 30, 2019

Summary

There are five steps to follow to get free credit counseling in Arizona. We will walk you through how to find a reputable nonprofit organization, what you can research in advance, what questions to ask when you are making a decision, what to expect during your meeting and what happens after. 

People are experiencing financial problems all across the United States, and Arizona is no exception. The average Arizona resident has over $5,000 in credit card debt alone. When your bills are piling up it can feel overwhelming to figure out how to get your finances back on track when you are working so hard all the time just to try to keep up. If you are facing a mountain of debt that never seems to get smaller, looking into credit counseling might help you to figure out those next steps. Credit counseling in Arizona allows you to sit down, one-on-one, with a counselor who is trained in consumer credit, money and debt management, and budgeting to look over your current financial situation and come up with a personalized plan for your next steps. These recommendations usually include a debt management plan, debt consolidation, or bankruptcy. Arizona credit counseling agencies are typically nonprofit organizations, and the counselors for reputable agencies are certified. There are plenty of national nonprofit organizations that offer these services online or over-the-phone, including Take Charge America which is headquartered in Phoenix. If you prefer to meet in person you can look to a local Arizona nonprofit organization or an Arizona branch of a national company. Credit counseling in Arizona may help a wide range of residents in several different ways. Many nonprofit credit counseling organizations offer free educational materials or workshops on skills to avoid further financial problems, like budgeting and general money management. Arizona credit counseling can be helpful even if you are not behind on your bills but still struggling to keep up with your payments. Not all Arizona credit counseling agencies are alike, however, so it is important to do some homework to make sure you going to an organization that is truly designed to help people. While there are many wonderful nonprofit credit counseling agencies in Arizona, there are also a lot of for-profit companies looking to take advantage of people. In this article, we will show you how you can find the right nonprofit agency to see if credit counseling services are the right debt relief solution to help get your personal finances back on track. 

How to Get Free Credit Counseling in Arizona

There are five steps to follow to get free credit counseling in Arizona. We will walk you through how to find a reputable nonprofit organization, what you can research in advance, what questions to ask when you are making a decision, what to expect during your meeting and what happens after.


Find Arizona Nonprofit Credit Counseling Agencies

The first step is to find a reputable nonprofit Arizona credit counseling agency. Keep in mind that just because an organization is listed as nonprofit does not mean it is legitimate. There are resources available to you from the Federal Trade Commission that can help you find an Arizona credit counseling agency that is legitimate with Arizona credit counselors who are right for you. Keep in mind that you can choose to go with a national nonprofit agency with services online or over the phone. Some of these organizations also have regional offices, or local Arizona credit counseling agencies may have physical locations if you prefer to go in person. You should also be looking for an organization with financial counselors who are certified and trained in consumer credit, money and debt management and budgeting. You should expect that the initial meeting will be free and consist of a one-on-one meeting with a thorough review of your circumstances. Additionally, the organization should be happy to send you educational materials for free in advance if requested, without requiring you to provide any details about your situation. If they make that request it should be a big red flag. If the company has high fees or requests “voluntary” contributions that should also be a red flag. 

Information to Research Before Talking to an Arizona Credit Counseling Agency

A good place to start your research of a particular Arizona credit counseling agency is with the Arizona Attorney General’s Office. On that site, you can get to the consumer protection division. There you can find out information about collections and debt settlement companies who may fraudulently claim to negotiate your debts lower, often at a high cost to you. They recommend that you check any agency you are considering going to with the Better Business Bureau to see how they are rated or if they have had complaints filed. It is also good to know that consumer credit counseling agencies can be certified by the National Foundation for Credit Counseling, so finding that accreditation on an agency’s website is a very good sign. 

Questions to Ask the Arizona Credit Counselor Before Signing Up

You are entitled to ask any questions you like that will make you feel comfortable with an Arizona credit counselor before you commit to working together. Some suggestions include asking about any costs involved, in advance. Even reputable nonprofit credit counseling fees can have a setup cost if you decide to enter a debt management plan or monthly fees, but these should not be excessive. Avoid any agency that pushes you for “voluntary” contributions. While you’re at it, if you feel that you might not be able to afford any fees moving forward it is completely reasonable to ask if there are any accommodations available to reduce or cover such fees. It’s also a good idea to ask about what range of services the nonprofit can offer. Ideally, they can go beyond dealing with the current crisis and have educational resources, materials or workshops to help reach your financial goals going forward. You can also ask about how the meeting will go and what you can do in advance to best prepare. It is completely reasonable to ask how the financial counselor is compensated because that can expose another potential red flag if they have incentives or bonuses for signing up users.

What to Expect During Credit Counseling?

You should bring along copies of your paystubs and bills to your Arizona credit counseling appointment. Provided you followed the above advice, the meeting will be on-one-on with a certified credit counselor, trained in consumer credit, money and debt management, and budgeting. The meeting will typically last for 45 minutes to an hour and should involve an in-depth review of your current financial situation, and can help you get your credit report. Usually, the meeting will end with a personalized plan and recommendation for next steps, which are most typically debt consolidation, a debt management plan, or bankruptcy. Your Arizona credit counselor may also suggest additional meetings or materials and workshops that might be helpful for you. When you are meeting with an Arizona credit counselor from a reputable nonprofit agency the focus should be twofold: first, helping with your immediate problems and second, providing resources and financial education so that you do not find yourself back in the same boat.

What Happens After Credit Counseling in Arizona?

After you have completed your credit counseling in Arizona you will emerge with an action plan for how to best tackle your current financial problems. The recommended next steps will be intended to give you the best option to get back on your feet going forward. Most typically this plan will be either a debt consolidation, a debt management plan or bankruptcy counseling. We will examine each in greater detail below.

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Arizona Debt Consolidation

An Arizona debt consolidation works by taking on new debt to pay off your current debt. This can be cost-saving by taking out one single loan at a lower interest rate to pay off unsecured loans like credit card debt, which typically have higher interest rates. This solution may be recommended if your debts are mostly credit cards, you have a decent credit score and are generally responsible with money. With this option, you can pay off and keep existing credit cards and have the simplicity of only making one payment per month. This may not be the best solution, however, if you also have other types of debts, like student loans and medical bills, or an insufficiently high credit score to qualify for a lower interest loan, and does not offer any debt counseling to help avoid this situation in the future.

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Arizona Debt Management Plan

An Arizona debt management plan is a debt repayment plan that is created and serviced by the credit counseling agency, without taking on any new debt. Your counselor can negotiate with your creditors to lower interest rates and relax late fees and work with you to determine a reasonable monthly payment and budget. You will make one payment monthly to the credit counseling agency and they will take care of making the payments to your creditors on your behalf. A debt management plan can include other types of debts beyond credit cards and help change your financial habits. You will need to close all credit cards (except for one for emergencies, if allowed under the terms of you DMP) and be diligent about making your monthly payments or the agreement can be void. 

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Arizona Bankruptcy

If you can’t afford to continue to make payments either through a debt consolidation or a debt management plan, bankruptcy may be the best solution. Bankruptcy exists as a legal remedy to help people or corporations in financial difficulty walk away from some or all of their debts. You can learn more about filing bankruptcy in Arizona and see if you qualify to partner with Upsolve, a nonprofit agency that can partner with you through the bankruptcy process at no cost

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About the author

Eva Bacevice, Esq.

Eva G. Bacevice graduated from the University of Michigan Law School in 2001. She practiced law for close to a decade in the area of consumer bankruptcy. She now works in higher education as an Academic Advisor for undergraduate students at the Stephen M. Ross School of Business,... read more

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