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Credit Counseling Service Demand Down, Hard. Hold On.

I’m going to start off this article with a disclaimer. Over the past few months I’ve been basically getting the shit kicked out of me every time I point to evidence that the debt relief space is in trouble for a decreasing demand from consumers. See the comments on these articles, here, here, and here.

I’ve also taken flak for publishing stories some view as “unpopular” or creating a “veritable shit storm” of what some perceive to be negative posts about the debt relief world. But sticking your head in the sand just to avoid unfortunate news does not make the news or forecasts wrong.

Only by looking forward with clarity can the debt relief industry better prepare for the days ahead. Gazing into the next 20 months with hopes things will return to what they have been like over the last three years would be a mistake based on the data.

I am a supporter of the debt relief world, or at least that world in which fair and upstanding companies provide reasonable and balanced services to consumers that are in a disadvantaged position.

My predictions and sharing with you what I hear from trustworthy sources inside the debt relief world are not an effort to scare companies. They are an effort to help companies prepare for what I see as the tough times ahead.

For the past year or more I’ve been saying that the best way to face the future is going to by to minimize overhead and cut expenses and staff to the bone in order to prepare to ride out the decreasing demand in the near future.

Just now I’ve received an email from a leading credit counseling provider that has said they agree, demand for credit counseling is down. They say other larger agencies are down 40% from this time last year which was down about the same amount from the year before. They say credit counseling demand is back to around early 2000 levels. And that’s a big problem for credit counseling groups that have built infrastructure based on the accelerated demand between 2000-2007.

Other groups have told me that as compared to this time last year the demand is down by as much as 60%

These statements are simply meant as an early warning to give the industry an alert that a tornado is headed this way. Without a good warning system you can’t have survivors. My unpopular and dire predictions are not meant to needlessly alarm, they are meant to warn to save those can listen and act to prepare.

So let’s take another look at updated search traffic data for credit counseling as provided by Google. This data is for United States only traffic.

Credit Counseling Service Demand Down, Hard. Hold On.

Credit Counseling Service Demand Down, Hard. Hold On.

Demand for other debt relief services continues to be impacted by the same trends.

I stand behind my prediction that until creditors loosen their grip on credit and begin to increase issuance, the demand for debt relief services will decline or lie flat.

Credit Counseling Service Demand Down, Hard. Hold On.
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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Steve Rhode

    Traffic is down on the site. But the site writes or has written about a number of topics, not just debt settlement, that people read.

    In the next month or so you will see the new site rolling out with the features the readers voted on previously. We are also broadening our focus with more articles on helping people to move forward beyond their financial crisis.

  • Steve Rhode

    Google states the search trend data is inclusive of all searches from all devices. This article was about credit counseling, thus no charts for the other terms.

  • Google Pro

    Steve,

    Post data for debt consolidation and debt settlement keywords. Fact is with credit counseling being on average 30% more expensive than a debt settlement program it’s no wonder why CCCS is dying out. Not to mention failure rates of 80+% with CCCS.

    Your telling 20% of the story. Also these trends do not include the 40,000 mobile devices that join the google search statistics daily.

    TDX

  • Google Pro

    Steve,

    Post data for debt consolidation and debt settlement keywords. Fact is with credit counseling being on average 30% more expensive than a debt settlement program it’s no wonder why CCCS is dying out. Not to mention failure rates of 80+% with CCCS.

    Your telling 20% of the story. Also these trends do not include the 40,000 mobile devices that join the google search statistics daily.

    TDX

    • http://GetOutOfDebt.org Steve Rhode

      Google states the search trend data is inclusive of all searches from all devices. This article was about credit counseling, thus no charts for the other terms.

  • Mike Reilly

    Steve, I think it’s clear to most that the data you have supplied, on more than one occasion demonstrates that search volume has dropped, hence a decrease in demand for debt relief services. I’m curious though, what are you experiencing here on this site? One could assume you are seeing the same thing if not greater based on fewer consumers in need and of course the industry shake up that has led many to leave.

    If you expect this to continue until credit eases, I think you indicated something like greater than 2 years, how are you planning to cope? I think we can all see that monetization has kicked in on an industry level (sure it’s always been there, seems accelerated) but do you think it will be enough or are you planning to reach the consumer in some way?
    Just wondering.

  • Mike Reilly

    Steve, I think it’s clear to most that the data you have supplied, on more than one occasion demonstrates that search volume has dropped, hence a decrease in demand for debt relief services. I’m curious though, what are you experiencing here on this site? One could assume you are seeing the same thing if not greater based on fewer consumers in need and of course the industry shake up that has led many to leave.

    If you expect this to continue until credit eases, I think you indicated something like greater than 2 years, how are you planning to cope? I think we can all see that monetization has kicked in on an industry level (sure it’s always been there, seems accelerated) but do you think it will be enough or are you planning to reach the consumer in some way?
    Just wondering.

    • http://GetOutOfDebt.org Steve Rhode

      Traffic is down on the site. But the site writes or has written about a number of topics, not just debt settlement, that people read.

      In the next month or so you will see the new site rolling out with the features the readers voted on previously. We are also broadening our focus with more articles on helping people to move forward beyond their financial crisis.

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