Today I got an email from USA.gov that struck me. The email made it seem as if credit counseling could help rebuild credit. That a no-no for credit counseling to avoid or run afoul of the CRedit Repair Organizations Act. I’ve covered that here.
The email USA.gov sent out linked only to National Foundation for Credit Counseling (NFCC) to find a trusted credit counseling agency. But what about the agencies that belong to The Association of Independent Consumer Credit Counseling Agencies (AICCCA). Are they chopped liver? (Disclosure: I’ve never actually had chopped liver but apparently it must suck.)
Just on face value the single source recommendation seems objectionable when other groups exist, like AICCCA.
But what the email to consumers fails to put into context are the other debt relief approaches and even data about their success and failure performance of the different debt relief options, including credit counseling. How is a consumer ever going to have any shot at informed consent without context and performance?
The NFCC appears to be tightlipped about the success and failure rates of their member agencies, the least transparent which provides consumers with incomplete critical information and yet they are the single source destination recommended by USA.gov.
The email I got:
Subject: How to Find a Trusted Credit Counseling Agency Near You
Did you know credit counseling agencies can help you create a plan to tackle your debt and rebuild your credit?
You can find a trusted credit counseling agency near you to discuss your financial options, but remember, no one can remove negative information from your credit report. Companies that offer to do this are often running scams.
The only way to repair your credit is to consistently make your payments on time.
However, if there is an error on your credit report, you can file a dispute with the major credit agencies to have the information removed.
Learn more about credit counseling and how you can rebuild your credit.