False Perceptions of Credit Counseling Keeps Consumers from Seeking Assistance and Getting the Help They Need

Questions Regarding Financial Concerns Go Unanswered for Many

A recent poll of 2,000 consumers indicated they are not reaching out for assistance with their financial concerns due to confusion regarding where to find substantive credit counseling help.  The poll was conducted in July and hosted on the National Foundation for Credit Counseling (NFCC) website.  The NFCC is the nation’s largest and longest serving national nonprofit credit counseling organization.  Springboard Nonprofit Consumer Credit Management (“Springboard”) is one of the largest housing and consumer credit counseling agencies on the West Coast and a member of the NFCC.

“The poll numbers are very disturbing,” said Melinda Opperman, Springboard’s senior vice president.  “The data indicates that far too many consumers have received misinformation about the consumer credit counseling industry.  Subsequently, consumers are missing opportunities to receive the help they so desperately need and can obtain for little or no charge from legitimate consumer credit counseling agencies,” said Opperman.

According to the poll, the majority of more than 2,000 poll respondents, 47percent, indicated they are not seeking assistance with their financial concerns due to confusion regarding where to find substantive help.  Another 24 percent do not think they can afford the assistance offered by a credit counseling agency.

The reality is that services provided by NFCC Member Agencies offer a stark contrast to the misconceptions reflected by the poll.  Consider the following best practices which apply to all NFCC Member Agencies:

  • Every member agency must obtain and maintain accreditation by the Council on Accreditation (COA).  COA is an independent third-party not-for-profit accrediting organization that has reviewed more than 1,500 social service programs to ensure compliance with rigorous best-practice standards.  After the initial accreditation, NFCC Member Agencies must be re-accredited every four years.
  • Counselors must understand the theories, principles, issues, counseling techniques, and forms that are applicable to credit and financial counseling, and prove that knowledge through testing on six modules related to personal finance.  Upon passing the tests, the counselor is awarded the designation of Certified Credit Counselor.  At this point, the counselor is eligible to obtain an additional certification, Certified Housing Counselor.  Professional Development Units must be earned every two years to maintain the certifications.
  • Comprehensive one-on-one money management counseling is provided with each client.  Following the counseling session every client receives a written assessment and action plan applicable to the service provided.  The action plan outlines the client’s individual situation and offers appropriate solutions, referrals and prioritized action steps.
  • Counseling services are offered free or at low cost.  Further, an NFCC Member Quality Standard to which members must comply specifies that services cannot be denied based on a person’s inability to pay.  Therefore, cost should not be a barrier to seeking assistance.
  • Financial education programs are provided on basic topics such as money management, budgeting and the responsible use of credit, as well as everyday financial life skills such as vacation planning and first-time homebuying.  Workshops and seminars are taught by qualified instructors and are designed to meet the current needs of those desiring to improve their financial knowledge.  Programs are free of charge and open to the public.

The survey also reflected despair in some of the answers.  Taken together, 19 percent of respondents either felt their situation was beyond help (13 percent), or were tired of trying to resolve their financial concern (six percent).  Only ten percent felt they could handle their situation on their own.

The actual poll question and responses are as follows:

Q:  I know I would benefit from credit counseling, but I’ve not reached out because

  1. I’m confused over where to find real help = 46%
  2. My problem is beyond help = 13%
  3. I can’t afford the help = 24%
  4. I think I can resolve things on my own = 10%
  5. I’m tired of trying = 6%

“We want to send a clear message to consumers who are experiencing financial distress, and that message is that legitimate help is available,” continued Opperman.  “People owe it to themselves and to their family to reach out to a trained and certified counselor for a review of their situation.  Delaying action only makes the problem harder to resolve.”

Springboard is highly regarded by community stakeholders as an agency that provides high quality education and counseling to consumers. Springboard was recently presented the Community Initiative Partner Award from the United Way of the Inland Valleys.  This is the second consecutive year that Springboard has received the award, which recognizes individuals and organizations for their significant contributions to the community.

SPRINGBOARD® Nonprofit Consumer Credit Management is a 501(c)(3) nonprofit personal financial education and counseling organization founded in 1974 with the mission of improving the financial wellbeing of individuals and families. Springboard is a U.S. Department of Housing and Urban Development approved housing counseling agency and a member of the Financial Counseling Association of America and the National Foundation for Credit Counseling; the nation’s longest serving nonprofit financial counseling organization. Springboard is also a proud member of the Hope Now Alliance, a cooperative effort between the U.S. government and mortgage market participants to help struggling homeowners. Springboard offers personal financial education and assistance in credit counseling, housing counseling, reverse mortgage, debt and money management, pre-bankruptcy counseling and debtor education through educational programs and confidential coaching. Springboard is accredited by the Council on Accreditation, signifying the highest standards for agency governance, fiscal integrity, counselor certification and service delivery policies. Counseling is available by telephone nationwide or in-person at office locations in California, Arizona, New Mexico, Texas, Massachusetts, South Carolina and Florida. For more information on Springboard, please call 800-449-9818 or visit their website at www.Springboard.org.

Springboard - Promoting Financial Literacy since 1974.