How To Get Free Credit Counseling in Wisconsin
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In Wisconsin, consumer credit counseling can only be offered by a licensed Adjustment Service Company. An Adjustment Service Company is defined under Wisconsin law as a company or agency engaged in the business of prorating the income of a debtor to the debtor's creditor or creditors, or of assuming the obligations of any debtor by purchasing the accounts the debtor may have with the debtor's several creditors, in return for which the principal receives a service charge or other consideration.
Written by the Upsolve Team.
Updated March 25, 2024
As Wisconsin experiences a recent rise in unemployment over the last five months, many Wisconsinites are having to make difficult decisions about paying their bills. In Wisconsin, 43% earn less than $50,000 per year. A woman working full time in Wisconsin earns a median income of only $25,865. Even those who find work after losing a job often go from one good-paying job to two lower-paying jobs. And going from one good-paying job to two or more low paying jobs leaves a lot less to pay bills with after your day to day expenses.
If you are struggling to pay all your bills after you meet your monthly expenses, credit counseling in Wisconsin can help. Wisconsin credit counseling is a risk-free, no-obligation conversation between you and a trained, certified Wisconsin credit counselor. During the session, your certified credit counselor will discuss your current financial problems, introduce you to the concepts of money management and debt relief, help you create your own budget, set some financial goals, review your credit report and recommend personalized solutions to help you become debt-free.
You can speak with a Wisconsin credit counselor in person or over the phone. You can even conduct the entire Wisconsin credit counseling session online.
Do I have to be behind on my debts to try credit counseling?
No. You don't have to be late or behind on your bills to get free credit counseling in Wisconsin. In fact, if you feel you're getting to the point where you will soon be unable to pay your bills when they become due, now is the perfect time to seek out a reputable credit counseling agency to discuss your situation and find out what debt repayment options are available to you.
Does my spouse have to come with me?
No. Credit counseling in Wisconsin is completely confidential. None of the information you disclose to your Wisconsin credit counselor with be shared with anyone without your consent. If after counseling you decide to enter into a debt relief program such as a debt management plan, then you may need to inform your spouse if they are a co-debtor on one or more of your debts.
How To Get Free Credit Counseling in Wisconsin
In Wisconsin, consumer credit counseling can only be offered by a licensed Adjustment Service Company. An Adjustment Service Company is defined under Wisconsin law as a company or agency engaged in the business of prorating the income of a debtor to the debtor's creditor or creditors, or of assuming the obligations of any debtor by purchasing the accounts the debtor may have with the debtor's several creditors, in return for which the principal receives a service charge or other consideration.
Find a Wisconsin Nonprofit Credit Counseling Agencies
In the State of Wisconsin, all budget and credit counseling agencies must be licensed as Adjustment Service Companies by the Wisconsin Department of Financial Institutions. Wisconsin law does not require that a credit counseling agency be a “non-profit” organization, so it’s very important that you ask if the agency you are considering obtaining credit counseling from is a non-profit credit counseling agency in Wisconsin. Even if they are a licensed Adjustment Service Company. A reputable accredited non-profit credit counseling agency such as Money Management International, CESI or GreenPath offers their initial credit counseling services throughout the United States free of charge. To get a list of other non-profit credit counseling agencies, you can try the Financial Counseling Association of America or the National Foundation for Credit Counseling (NFCC). Once you’ve developed a list of potential non-profit credit counseling organizations, refer to the Wisconsin list of licensed Adjustment Service Companies to see if they are licensed to provide budget and credit counseling in Wisconsin.
Should I expect to pay for the initial meeting?
No. While Wisconsin law does not prohibit an Adjustment Service Company from charging a fee for initial credit counseling, your initial credit counseling session should always be free. If you are asked to pay upfront for a credit counseling session, whether online or in-person, that is a red flag that you may not be dealing with a reputable credit counseling agency that has your best interest at heart.
Information to Research Before Talking to a Wisconsin Credit Counseling Agency
Even if the credit counseling agency you are considering going with is licensed, you should still do some basic research on your own to make sure they have your best interest at heart. If you choose to go with a non-profit credit counseling agency, you can verify that the credit counseling agency you are planning to meet with is accredited by verifying their accreditation with the National Foundation for Credit Counseling or similar organizations like the Financial Counseling Association of America. If you choose to go with a for-profit company, it may not be accredited and may not follow the practices and standards set by these national accrediting organizations.
Check for Complaints with the Wisconsin Attorney General
Whether you are considering a non-profit or a for-profit company you can check if any complaints have been filed against them with the Consumer Protection Division of the Wisconsin Department of Justice.
Check their rating with the Better Business Bureau
Another excellent resource you can use to check a credit counseling agency’s track record is its rating with your local or national Better Business Bureau. Most reputable private companies especially maintain an “A” rating or better with the BBB.
Questions to Ask Your Wisconsin Credit Counselor Before Signing Up
Just deciding to seek credit counseling when you are having financial difficulties is a courageous decision. Having done so, do not be ashamed to ask your Wisconsin credit counselor any questions you feel you need to be answered before moving beyond your initial credit counseling. The credit counseling agency you choose to deal with should not only invite you to ask whatever questions you have but they should welcome them. Below are some questions you may want to start with.
Is there any cost for the initial session?
Remember an accredited, non-profit credit counseling agency will never charge you a fee for an initial credit counseling session.
How are your counselors compensated?
This is a fair question to ask. If your counselor is paid a bonus or incentive to get you into a specific type of debt relief plan, then that is an indication they may not have your best interest at heart. Non-profit credit counselors are never compensated based on whether you agree to a specific plan.
Do you pay a referral fee if I refer other family members to you?
The answer to this should always be no. Wisconsin law prohibits Adjustment Service Companies from paying for referrals.
What to Expect During Credit Counseling
You should view your initial credit counseling session as a conversation. You and your Wisconsin credit counselor will discuss your present financial condition, the circumstances that may have given rise to your present financial condition, what you would like to change or see happen as a result of counseling and putting a plan together to get you there. You may not need to bring any documents to your initial counseling session. Although at a minimum you should have a list of the bills you pay every month such as credit cards, medical bills, student loans, groceries, and rent. You should also have something showing much you earn and how often you get paid. Later, if you decide to start a debt management plan or other debt relief program they offer, you will need your actual credit card statements that show your current balance, minimum payment, due date, annual interest rate, late fees, over-the-limit fees and other monthly fees associated with your accounts.
The length of your session will depend on your situation and your level of motivation. If you are just interested in some basic details and information on how debt counseling works, then the session can be as short as thirty minutes. On the other hand, if you are serious about getting your finances under control and ready to start a debt management program tailored to your specific needs it can last up to an hour.
Will I be given information I can take with me?
Absolutely. Any reputable credit counseling agency you meet with should have pamphlets, brochures, flyers or other educational material you can take with you after your initial counseling session to learn more about how debt consolidation works.
Will I get an action plan on how to deal with my debts?
Yes. Using the information you have shared with them, and the programs they have access to, you and your counselor will come up with a specific action plan to address your current financial challenges.
What Happens After Credit Counseling in Wisconsin
Wisconsin credit counseling is only the first step to true, long term debt relief. It is a big step but the real commitment to get out of debt and regain control of your personal finances will come when you put your custom debt management plan into action. Let’s take a look at what one of those plans might look like.
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Wisconsin Debt Consolidation
Debt consolidation is a proven debt relief process that can help almost anyone improve their financial condition without having to file bankruptcy. Debt consolidation involves taking all of the unsecured debt you owe and combining it into one account. You then make one payment on that account until the debt is paid off.
Debt consolidation works by reducing the number of bills you have to pay each month to just one. This means you are less likely to forget to pay it, and it'll be easier to plan for your other monthly expenses like rent or your mortgage payment. When you consolidate your debt, you can often get a lower interest rate too. This means your new payment will be lower than what you used to pay out every month on all your debt.
Wisconsin Debt Management Plan
A Wisconsin debt management plan can accomplish the same thing as a debt consolidation loan. However, unlike a debt consolidation loan you do not have to have good credit to get approved, you do not have to take out one big loan to pay off several smaller loans and you do not have to worry about promotional interest rates that may go up significantly if you do not pay off the loan in a limited amount of time.
A debt management plan combines all of the monthly payments you make on your unsecured debt into one monthly payment. Often with a lower interest rate on the total debt and a lower overall monthly payment. The plan works by setting up a voluntary agreement between you and your creditors to centralize your payments to all of them through your chosen credit counseling agency.
In addition to a lower interest rate, most Wisconsin credit counseling agencies can also get your over-the-limit and late fees waived. When you sign up for a debt management plan, you make one lump sum payment each month to your chosen Adjustment Service Company who then sends those funds directly to your respective creditors.
Will it affect my credit score?
A debt management plan will cause your credit score to initially fall when your credit accounts are closed as part of the plan. But as you pay off the debt that you have consolidated, your credit score will gradually increase again.
Wisconsin Bankruptcy
One option your Wisconsin credit counselor may bring up at the end of your credit counseling session is a Wisconsin bankruptcy. If you are unable to work, have no income, or simply have too much debt to reduce your bills enough with debt consolidation, then a Wisconsin bankruptcy may be your best choice. Bankruptcy legally eliminates debts that you can no longer afford to pay.
There are several types of consumer bankruptcies but the two most common are Chapter 7 and Chapter 13. Chapter 7 bankruptcy is primarily for individuals with less than $10,000 in assets, who earn less than $50,000 per year and often do not own a home. Chapter 13 bankruptcy, on the other hand, is better for individuals with significant assets, higher income, and homeowners that have fallen behind on their mortgage. In addition to credit counseling, almost all non-profit credit counseling agencies in Wisconsin also offer free bankruptcy counseling.
