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This brief article will enlighten you to some of the truths about consumer credit counseling programs. These are the facts that turn in a drop out rate of in some cases over 80% of the debtors who enroll themselves in these programs. People should be knowledgable of these facts before they enroll themselves into a credit counseling program to ensure themselves they are deciding on a beneficial financial move.

1. The vast majority of the credit counseling organizations are created and funded by the actual credit card companies themselves. They are somewhat of a middle man for the credit card company to collect the debt amount owed.

2. The credit counseling organizations work for and represent the credit card companies; they do not work on behalf of the debtor. The credit card organizations dictate to the credit counseling company the minimum payment requirement, and the APR. There is no negotiation at all on this.

3. The credit counseling organizations should be able to lower the interest rate, however they cannot actually lower the principal balance. The average interest rate on one of these programs is around 13% which is more in the middle than actually being a low interest rate. By not lowering the principal balance they are not truly a form of credit card debt reduction, this is just an sped up payment program.

4. You will wind up actually paying more than the original debt amount, due to the monthly maintenance fees, APR and lowered monthly payments which greatly extends the amount of time you are going to be in debt.

5. It can have a temporary adverse impact on your FICO credit score and is made a public record on your credit history, during the time you are in the program.

6. Getting a mortgage for a house while on a credit counseling program becomes undeniably complex, on the edge of being impossible.

7. Here is the kicker and read extremely carefully. If you fall behind only one payment while on a credit counseling program you will be booted off and the credit card companies will not allow you to sign into another program for up to a year. Which will put your bills to where they were prior to enrolling into the program, high interest and all. This is the reason why upwards of 75% of the people signed into these programs fail off.

Sit back and really think hard about this for a sec. They put you on a credit counseling program that may be up to 5 years or more. As we all know the adventure that is life has its good times and its bad times. If you find it extremely hard to be on the program in the first place you will drop out. Any random financial problems as big or small as they may be might contribute to you falling behind just one payment and getting the boot from the program. You need to seriously think about how constant your finances and income security are before enrolling into a credit counseling program to keep away from being part of that 80%. The bottom line is people with a considerable sum of debt such as $15,000 or more should look more towards credit card debt settlement than credit counseling. Credit counseling is much more viable for debtors with smaller sums of debt that do not have much of any problems keeping up with their bills in the first place. If you are searching for a way to reduce your debt and get out of debt very quickly, then credit counseling is just not the way to go.

Steve Bis is a debt analyst and research assistant with the US Consumer Advocate, which primarily practices in credit card debt relief.