Credit Counseling
Needs
Many consumers lack the knowledge, skills, or attitudes to plan and manage the use of credit. Some consumers who could handle the payments responsibly have trouble getting cash or retail credit. But far more common today are young students and adult consumers who are given access to credit but who are not able to control its use. They have a variety of problems; their needs range from simple information on how to plan and manage credit use, to counseling and debt management assistance, to legal services in order to file for bankruptcy. A new trend in the credit marketplace is causing even more problems for unwary consumers. Many lenders are consciously offering credit cards to consumers with limited income and poor credit records, increasing the temptation to borrow what they can not afford to repay.
Concerns
Overall, consumers do not seem to understand, or are unable to act on knowledge of the serious consequences of a bad credit record. Access to nationally recognized nonprofit credit counseling is quite limited in the state. And todays masters of credit fraud are making a bad situation worse, convincing people to waste money in fraudulent "credit repair" scams and stealing credit card numbers and expiration dates to sell in widespread long-distance telephone fraud.
Community Response
Communities need to look at local credit problems, bankruptcy trends, and the adequacy of education and counseling for different age groups -- including education to prevent credit fraud. Communities can promote two levels of credit education: to prevent credit problems and to teach people how to deal with minor problems themselves. Communities can support the expansion of consumer credit counseling services that are affiliated with the National Foundation for Consumer Credit or other reputable certifying agencies for nonprofit counseling and debt management. And they can provide access to information on how to identify and avoid credit fraud.
Strategies
1. Promote and Support a Variety of Educational Activities
These activities would teach young people and adults how to:
• Obtain credit.
• Plan and manage the use of credit.
• Check the accuracy of information in your credit record.
• Request the correction of inaccurate information in your credit record.
• Avoid credit fraud.
• Weigh the pros and cons of filing for bankruptcy.
2. Consumer Credit Counseling Services (CCCS) Program
Communities with this program or with access to credit counselors from nearby counties can:
• Identify ways to support and expand the CCCS.
• Publicize the availability of the program
• Explain the way CCCS functions to encourage people to use its services
3. Communities without a CCCS Office
Communities without this office can help bring together lenders, retail merchants, DSS reps, employers, bankruptcy court trustees, and consumer educators (such as Family and Consumer Education Agents with Cooperative Extension) to consider the options for obtaining a nonprofit credit counseling service. Contact the National Foundation for Consumer Credit to obtain information on how to form a new CCCS office or to get a list of CCCS offices that might be able to arrange for a branch office or periodic visits from a credit counselor in cooperation with some other agency. NFCC is in Silver Spring, MD, at 1-800-388-2227.
4. Communities with Hispanic or Other Non-English-Speaking Audiences
Such communities can make a special effort to be sure immigrants who are not familiar with the American consumer credit system receive information that helps them avoid a negative credit record -- or helps them receive legitimate credit counseling instead of falling victim to fraudulent "credit repair" scams.
5. Consumer Credit Counseling Services Offices
Consumer Credit Counseling Services offices in North Carolina are affiliated with the National Foundation for Consumer Credit, Inc., and are listed in the 1997 NFCC Directory. Call 1-800-388-2227 for the number of the office that offers counseling at sites not listed. Call the nearest office(s) and ask whether it serves additional locations that may be more convenient to you.
North Carolina Offices for Consumer Credit Counseling
