This brief article will enlighten you to some of the problems with credit counseling programs. These are the problems that turn in a failure rate of over 80% of the clients enrolled in these programs. People should be knowledgable of these facts before they enroll themselves into a online consumer credit counseling program to make sure for themselves they are deciding on a good financial decision.

1. A great number of the online consumer credit counseling companies are created and paid for by the actual credit card companies themselves. They are nothing more than a middle man for the credit card companies to collect the debt amount owed.

2. The online consumer credit counseling companies work for and represent the credit card companies; they do not work on behalf of the debtor. The credit card companies orderto the credit counseling company the monthly minimum payment that is required and the APR. There is no compromise at all on this.

3. The online consumer credit counseling companies should be able to reduce the interest rate, however they can never actually reduce the principal balance. The typical interest rate on one of these programs is around 10% which is more in the middle than actually being very low. By not reducing the principal balance they are not really a form of debt reduction, this is just an accelerated payment program.

4. You will end up actually paying more than the principal debt amount, due to the monthly maintenance fees, APR and reduced monthly payments which greatly bumps up the amount of time you are going to be living with debt.

5. It can have a short term bad effect on your credit rating and is made a public record on your credit report, during the duration of the program.

6. Receiving a mortgage for a house while on a online consumer credit counseling program can become undeniably complicated, on the edge of being impossible.

7. Here is the biggest problem and read carefully. If you fall behind only one payment while on a online consumer credit counseling program you will be kicked off and the credit card companies will not allow you to re-enroll into another program for a year. Which will put your debts right back to where they were before, high interest and all. This is the number one reason why upwards of 75% of the debtors enrolled in these programs fail off.

Relax for a minute and think twice about this. They put you on a online consumer credit counseling program that may last 5 years or more. We all know life has its good times and its bad times. If you find it extremely hard to be a client on the program in the first place you will drop out. Any volatile financial problems as big or small as they may be can contribute to you missing just one payment and getting kicked out of the program. You need to seriously think about how stable your finances and income security are before you enroll into a credit counseling program to avoid being part of that 80%. The bottom line is people with a considerable amount of debt such as $10,000 or more should look more towards credit card debt settlement than credit counseling. Credit counseling is more reasonable for debtors with much lower sums of debt that do not have much of any problems keeping up to date with their accounts in the first place.