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Counseling Services Helping You with Serious Debt Problems

If you have a serious debt problem, a reputable counseling service might help you avoid losses. A variety of organizations specialize in helping borrowers deal with debt overload, minimize the damage to credit histories and, in the worst cases, avoid foreclosures that could result in the loss of a home or other property. Their services range from helping people establish a budget to talking with lenders to discuss modifying the terms of a loan. But be careful before signing an agreement with a credit counselor because some may offer questionable or expensive services, and others may be scams.
Start your search by asking people you trust for referrals. Then check with your state Attorney General, local consumer protection agency and the Better Business Bureau about any complaints against the organization. "You'll also want to know as much as possible about the services, the fees, the qualifications of the counselors, and how much input you will have in working out the details of any commitments with your lender," added Sam Frumkin, a Senior Policy Analyst in the FDIC's Division of Supervision and Consumer Protection.
In addition, the FDIC and other banking regulators have been urging borrowers who are delinquent on a mortgage loan and at risk of losing their home to get help from a specialist called a "housing counselor." To find a reputable one in your area, contact the U.S. Department of Housing and Urban Development or the Homeownership Preservation Foundation.