Credit counselors provide a valuable service by helping you get out of debt. When you enroll in a debt management program, or DMP, you send a single monthly payment to your credit counselor, who then distributes it to pay off your credit cards and other unsecured debts. People drowning in their debt often turn to credit counseling services.

But some credit counselors are little more than scammers, requiring large upfront payments before they will even discuss their strategies with you. Worse, some of these companies have hidden fees that customers don’t know about until it’s too late. Then they owe even more money, and fall even farther behind on their payments. A few particularly disreputable credit counseling services took people’s money and did nothing to alleviate their debt. Luckily, the Federal Trade Commission (FTC) has forced many of these criminal organizations out of business.

So how can you tell if you’re getting involved with a good credit counselor or a money-making operation that will do more harm than good?

Legitimate credit counseling services have debt counselors who have been trained and certified in many areas of personal finance. They will assist you in drawing up a budget, managing your income, paying off your debt, and improving your credit score. If a credit counseling service has nonprofit status, their counselors are required by law to educate and counsel clients. They will also offer information about their services, free of charge. Beware of any business that charges you money before they even outline what their services involve!

When you choose a credit counseling organization, the FTC recommends asking the following questions:

What services do you offer? A reputable organization offers personalized service complete with initial and follow-up consultations. Their advice will be tailored your debt scenario. Steer clear of companies that claim a DMP is your only option. If a DMP is right for you, that will be decided after the counselor spends time carefully scrutinizing your financial situation.

Will I receive a written agreement or contract? Get everything in writing. Scammers count on making a quick deal to confound customers, later slipping in fees and costs that weren’t agreed upon. Get a written copy of your entire agreement and fee structure to avoid misunderstandings. If a credit counseling service pressures you to make a commitment over the phone, take your business elsewhere.

Are your counselors accredited by a third-party organization? If a company’s counselors were trained by a creditor-affiliated organization, they might not have your best interests at heart. For example, they might receive a commission from creditors when you enroll in a DMP, even if that’s not the best course of action.

What is your status with the Better Business Bureau (BBB) and Attorney General’s office? If the company has had complaints filed against them, you can check with those sources to find out details about the complaints. 

Once you’ve found a nonprofit credit counseling service that meets these criteria, get a written contract and get ready to breathe a big sigh of relief – your debt-free days are coming soon!

You took out several loans to help pay for your college expenses. Now you’ve (hopefully) graduated. There’s only a six-month grace period before Uncle Sam comes knocking, wanting his money back. But the job market is scary right now, so you’re either unemployed or working for sub-par wages. With student loan repayment lurking just around the corner, what can you do?

First, stay calm. Student loan providers anticipate that people will sometimes have difficulties repaying their loans. They’ve planned for this eventuality. All you need to do is contact them and let them know what’s going on. If your payments seem a bit high but otherwise manageable, you should consolidate your student loans. If your situation is very serious and you cannot make the payments at all, ask the student loan servicer for a deferment or a forbearance.

Consolidating your student loans combines all of your outstanding debt into one sum. The interest rate on consolidated loans is very low, and doesn’t exceed 8.25%. The reduced monthly payments are more budget-friendly for most graduates. Talk to a loan officer at your bank or apply online to lump your student loans together.

What if you simply can’t find work, or you’ve got other hardships that prevent you from repaying the loan right now? Call up your student loan servicer and ask about a deferment that would delay your payments for a month or longer, as needed. This is a good solution for temporary financial problems. 

If you don’t foresee your situation improving in the next few months, ask for a year-long forbearance. You’re usually eligible for one when your loan enters repayment status, and again when your loans get consolidated. Interest will continue to accrue while your loan is in forbearance, so start making payments again as soon as possible.

You can contact your student loan servicer by phone or over the Internet. They really do want to help you repay the loan, so most of them will be sympathetic to your plight. They might recommend a graduated repayment plan that starts with low payments that increase as time goes on and you, presumably, bring in more income. Income-sensitive plans are another option for low wage-earners.

Don’t forget that you could be eligible for tax breaks while repaying your student loans. Depending on your income, you could be able to deduct as much as $2,500 of student loan interest payments. To qualify for this tax break, single adults have to make less than $65,000 a year, and couples need to make less than $130,000 annually.

If you’re struggling with your student loan debt, rest assured that you have options. Help could be just a phone call or mouse click away. Contact your loan servicer today and get started down the path of recovery.

Credit card debt can creep up on you before you know it, thanks to fees and interest that are subject to change (always for the worse) with very little notice. If you’re not in the habit of paying off your credit card balances in full every month, you could soon find yourself mired in debt that never seems to go down even when you make a payment.

Since you can’t close your eyes and make credit card debt go away, you’ve got to find a way to pay it off – the quicker the better. Many people take out loans to accomplish this. It makes sense; better to pay a single monthly payment at a low interest rate than to make several credit card payments each month, all at higher rates of interest.

But some loans are a bad idea. For starters, let’s take a look at home equity loans. They are often easy to obtain and offer low interest rates. But what if you take out a home equity loan to pay off credit card debt, only to find yourself falling behind on your loan payments? Now you’ve got more at stake than your credit score; you could actually lose your house.

If you’re certain you’ll be able to handle the payments, a home equity loan might be useful for paying off other debt. But be honest with yourself. If you think delinquent payments are a possibility, find another source of money that won’t put your home at risk.

Many people borrow against their retirement funds when they want to pay off their credit cards fast. This isn’t a good idea, either. For one thing, the more money you keep in these funds, the more they will grow. The more money you take out, the less growth potential the fund will have. 

Borrowing from your 401K might sound like a fast solution to credit card debt, but consider the consequences: it will be more difficult to keep up your retirement fund contributions while you’re also trying to repay the loan. And if you get laid off, you’ll have about 90 days to repay the whole loan before it gets taxed and penalized.

If your credit card debt can realistically be paid off in a year, try transferring the balance to a card with a 1-year introductory rate of 0% interest. You can also talk to your bank about a low-interest personal loan, and use those funds to pay off your credit cards.

Just paying off the debt isn’t enough; you also need to figure out how you got so indebted in the first place. Were you paying for urgent expenses like car repairs? Then you should set up an emergency bank fund to pull from when those situations arise. Were you simply living beyond your means? Stick to a good budget, and you’ll get everything you need without overspending on frivolous items. There are many ways to cover unforeseen expenses and little extras, but credit cards are a costly option.