When you meet with a credit counselor, you’ll be asked to provide information about your income, expenses, and debts. After analyzing and discussing this information with you, your counselor may recommend that you:

• Continue to handle your finances on your own.
• Participate in agency education classes.
• Enroll in a debt-management/repayment plan.
• Be referred to another organization for assistance.

If you decide to enroll in the debt-management/repayment plan, you will be asked to stop using your credit cards or incurring debt. The counseling agency will negotiate a repayment schedule with your creditors that will generally allow you to get out of debt in two to five years. You’ll make one monthly payment to the agency, which will then pay your creditors.

If you are concerned about the effect that credit counseling may have on your credit history, talk to your counselor about it. Some lenders may bring your account current and report it as being paid on time, as long as you stick with the program. Others may report that your account is being repaid through credit counseling or may even report your account as delinquent, both of which can look negative to future creditors. The fact that you met with a credit counselor will never appear on your credit report if you just get budgeting advice and do not choose to enter the debt management plan.

What you shouldn’t expect from a debt counselor is legal advice or detailed advice about filing for bankruptcy. For these, you should talk with an attorney.