What are “credit counseling” services?

Credit counseling services are professional services that assist consumers in managing their debt effectively. These services typically involve a comprehensive assessment of a client's financial situation and a detailed plan to help them address their debts. Credit counselors guide consumers through various strategies, such as budgeting, negotiating payment plans with creditors, and exploring options like debt management plans, which can consolidate debts and potentially reduce interest rates.

The focus of credit counseling is on providing educational resources and personalized advice that empower consumers to take control of their financial health. Counselors may also help clients understand their credit reports and scores, but the primary aim is to facilitate debt management rather than merely improving credit scores.

In contrast, other options such as those that focus strictly on credit score blending or agencies that grant loans focus on different aspects of credit and do not address overall debt management effectively. Similarly, investment firms are not directly related to aiding consumers in resolving debt issues, as their primary objective is typically investment growth rather than providing solutions for debt problems.