Make No Mistake: Credit Counselors Work NOT for Profit
When consulting with credit counselors in the effort to have your credit repaired for possible home ownership, know this — these credit counselors shouldn’t be making any money off of you! No, no, no….
Why Is That? What’s in It for Credit Counselors Then?
Here’s the truth regarding what the law would say about credit counselors — if they’re legitimate, they’ll be nonprofit. That means they’re not in this for personal gain. They provide a service and receive their compensation through other means. Not through your own income. No, they won’t take a commission; no, these credit counselors won’t take a fee directly out of your pocket; and, no, they shouldn’t charge by the hour.
Now of course many supposed credit counselors will toss the term “nonprofit” around like it’s candy, but there are ways you can go about determining the status of such credit counselors through the IRS. Ever heard of 501(c)(3)? That’s the Internal Revenue service code for such nonprofit charities. You can search for credit counselors established as 501(c)(3), nonprofit, and know that you just may be working with legitimate credit counselors who won’t scam you out of your money.
Definitely Worth Doing the Research About Credit Counselors
This is especially the case when the IRS recently had took another look at some credit counselors out there with nonprofit status and reviewing the information a bit heavier, ensuring that the statuses are valid. In many cases, the IRS revoked such status from certain credit counselors —
What does this tell you? Be very careful. Be extremely vigilant with anyone you’re consulting regarding your own finances. Always look for the most updated information online, on the books, or through referrals. Because you never can tell — you just might be dealing with a scammer when it comes to your finances.