Consumer Credit Counseling Service (CCCS) (2024)

FAQs

What is the consumer credit counseling service (CCCS)? ›

Consumer Credit Counseling Services (CCCS) are mostly non-profit organizations that offer free or low-cost counseling, education, and debt repayment services to individuals in danger of bankruptcy.

CCCS was created in response to the increasing use of credit cards and lack of consumer awareness in the 1950s. The Department of Justice provides a list of trustworthy CCCS available nationwide to help individuals avoid illegitimate organizations.

Credit counseling programs show on your credit report while you are enrolled – most go for 5 years. When you enroll in a debt management plan with a credit counseling service, your accounts with most major credit card issuers will reflect that you are on a debt management plan.

American Consumer Credit Counseling is a legitimate nonprofit credit counseling organization. ACCC is accredited with the Better Business Bureau (BBB) and has a 4.93-star rating.

By way of background, Consumer Credit Counseling Foundation, Inc., founded in ****, is an ISO 9001:2015 certified 501(c)(3) nonprofit organization specializing in free and low-cost financial education, credit counseling and debt management solutions, as well as community seminars and outreach programs for consumers ...

Is National Debt Relief legit? National Debt Relief is an accredited member of the American Association for Debt Resolution (AADR). It has been around since 2009 and has helped over 600,000 individuals reduce their debt. It also has an A+ rating from the BBB (Better Business Bureau).

Disadvantages. One of the main disadvantages of using credit counseling is that it may affect your credit report. Some agencies may put a comment on your report that indicates you are on a debt management plan through credit counseling.

First, ask if the counselors are certified and through which organization. Ask if the service is nonprofit, how and when creditors get paid and make sure to ask about fees. With a debt management plan through a credit counseling agency, your creditors will be paid every month.

Debt counselling will very likely improve your credit score because it will show that you have consistently made your payments on time during the process.

This is a hard figure to track since the credit counseling industry does not publicly report their success rate. But industry insiders report success rates of 20% to 25%. (See this article: Does Credit Counseling Work?) Debt Settlement.

What are red flags that you should watch out for when choosing a credit counselor? ›

A reputable credit counseling agency should send you free information about itself and the services it provides without requiring you to provide any details about your situation. If a firm doesn't do that, consider it a red flag and go elsewhere for help.

CreditAssociates may hurt your credit, like any debt settlement company. Debt settlement typically requires you to stop paying creditors in order to provide leverage during the negotiation process.

Checking your own credit report is not an inquiry about new credit, so it has no effect on your score. In fact, reviewing your credit report regularly can help you make sure the information the credit reporting companies share with lenders is accurate and up-to-date.

Typically, with most of the common credit models, 850 is the highest credit score possible and anything from 800-850 is considered excellent.

Your counselor will contact your creditors in an attempt to reduce your interest rates, remove fees, and create a monthly payment plan you can work with. All of your debts will be combined into one monthly payment that will be made to the counseling agency and they will then pay each of your creditors.

What Is Credit Counseling? Credit counseling provides consumers who may feel overburdened by debt with guidance on consumer credit, money management, debt management, and budgeting. The goal of most credit counseling is to help a debtor avoid bankruptcy if they find themselves struggling with debt repayment.

Nonprofit credit counseling organizations receive funding from voluntary contributions from creditors. This allows agencies, such as American Consumer Credit Counseling, to provide services to anyone, regardless of income level, at a lower cost.

What fees does CCCS charge? There is no charge for appointments related to spending plans, managing debt, improving credit, avoiding foreclosure, or home buying counseling. On the other hand, there are fees applied to Reverse Mortgage counseling and participation in the Debt Management Plan.