When you go to a debt counseling session, your counselor will need to learn all about your financial situation so she can develop a plan to help you. First, you should be ready to tell her why you decided to come to debt counseling. For example, you may have experienced unemployment or a hardship that caused you to go into debt. Be prepared to discuss this and other factors that led you to borrow money. Second, your counselor needs to see the specifics of your finances, such as the total amount of your debt and your income. Here is the information you should make sure you bring—and why withholding information can hurt you.
Bring Statements of Your Debts
You should bring information about all your debts. Bring statements of your unsecured debts, which include credit card debts, personal loans, and hospital bills. These are the kinds of debts that will be eligible for a debt management plan. Although secured loans like home mortgages and auto loans aren’t covered by debt management plans, you should bring information about them, too, so your counselor can get a complete picture of your finances.
Bring Statements of Your Income and Assets
Bring proof of your income, including tax returns and your most recent pay stubs, to your debt counseling session. In addition, you should bring statements of your assets, which include bank accounts, investment accounts, and property you own.
Bring Records of Expenses
Bring records of how much you spend per month on rent, utilities, food, and transportation. Also, bring records of routine medical expenses and any other expenses that are essential. This information allows your debt counselor to figure out how much of your monthly income you need available for spending and how much could go toward paying off debts.
Why You Shouldn’t Withhold Information
If you withhold information from your debt counselor, she will not be able to make the best plan for your situation. Acting on the resulting plan could cause financial or legal problems. For example, if you don’t report the full amount of your income, your debt counselor might decide that you are not eligible for a debt management plan and might recommend bankruptcy instead. You could then end up unneccessarily filing for bankruptcy and harming your credit—and repeating the mistake of failing to disclose your correct income on a bankruptcy application could result in serious criminal charges. Spare yourself from avoidable financial and legal difficulties by providing accurate information to your debt counselor.
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Consumer Education Services, Inc. empowers people to overcome their financial challenges and lead financially-healthy lives.
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