Matthew Graham writes frequently for mortgagenewsdaily and has a great post on mortgage counseling and the freeze plan:

Excited to have an ARM adjusting in June, I called HopeNow to find out how I could get my loan frozen. Here's the conversation as it happened almost word for word each of the eight times I called (almost is if they had a script! Hard to imagine for a call center!):

Me: "Hey, I'm calling to find out how to get my loan frozen."
Them: "We are a consumer credit counseling service. We do counseling,"
Me: "I'm not behind on my mortgage, and I meet the other guidelines, but I have an adjustment coming up and I want to freeze it.
Them: "We don't do that"
Me: "But I just heard the president say that you would help me?"
Them: "He gave our number as a resource because we are counselors"
Me: "So you can't help me freeze my loan?"
Them: "We are counselors, we don't do that here."
Me: "Well, in June I'm not going to be able to make my mortgage payment, what do I do?"
Them: "I don't know, as I said, we are just counselors"

I have long said that credit counseling and mortgage counseling is often ineffective. I wish it were not so but it is.

The other day I spoke to "John" who is a senior executive with a very large bank. He said that they recommend people pursue credit counseling and mentioned a few non-profits. If he has ever had experience with those people he might not recommend them anymore.

What people need is real help in cutting their mortgage, slashing credit card debt and restructuring their financial lives without bankruptcy. Bankruptcy is a solution for some but often is not an answer.

Congress changed the bankruptcy laws to make it much harder to get a discharge of debt, or chapter 7. So you will often end up for years with court supervised payments. If you know how to do it, you can get credit works mortage relief counseling that really works, the type that involves you actively helping yourself.

Meanwhile try to get this counseling but be skeptical. Especially be skeptical of those credit counselors who want you to pay them and then they pay your creditors. You can reduce your credit card debt without bankruptcy if you know how. And you can do a short sale: How to sell your house in nine days when there are no buyers, if you qualify and know the ins and outs.

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