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If you are deep in debt, and plan on looking for a solution, be warned. Not only do you have to sort through all the competing companies clamoring to help, but you may also stumble into a “War of the Roses” of sorts among the competing factions in the debt relief industry.

[Consumer Resource: Do-it-Yourself Debt Reduction]

You would think that debt relief companies would just want to help consumers find a solution to their financial problems, and some do, but there’s also a lot of animosity between the various debt relief solutions: bankruptcy attorneys who warn that debt settlement is just a scam; credit counselors who are reluctant to refer consumers to settlement or bankruptcy; debt settlement firms that sign up clients who should be talking to a bankruptcy attorney, or who might be successful in a credit counseling agencies’ Debt Management Program.

Last fall, Steve Rhode finally said “enough is enough” and brought together some of the top groups in the debt relief industry in for an open discussion.  Many years ago, Steve established and ran a successful national credit counseling agency and, though he left that business some years ago, he has since become an outspoken critic of harmful practices in both the credit counseling and debt relief industries.

[Consumer Resource: Consumer Guide to Debt Settlement]

His November 13, 2010 “Rally in Raleigh” meeting led to the resurrection of the American Association of Credit Counselors, a group that had disbanded in the 1980s. The new AACC is more of an alliance than a trade association. The stated purpose is to: “…first assist consumers to receive ethical, open and transparent advice and assistance. Second, to work closely with regulators and legislators and provide information and data to honestly understand the debt relief world.”

“The whole focus of the group is to produce some parity in the debt relief industry at large,” says Rhode, “because the goal of the organization is to put consumers first.”

Because there is no staff to pay, the group doesn’t have to admit members just to collect dues. And because it’s not a lobbying organization, dues aren’t required to pay lobbyists.

Mike Croxson, president of Care One’s Services Inc., a founding member, explains it this way: “Trade groups in the debt relief industry — and I mean those representing non-profit and for profit organizations alike — have had a long and colorful history of failing to provide transparency to consumers, regulators and lawmakers.  They have consistently done whatever they thought made sense for their dues paying members rather than for consumers.  We at Care One were pleased to be asked to be a founding member of AACC because it is not a trade group… Our hope is that the effort helps reform the negative image that has been created by bad actors in the past.”

Industry Group Brings Together Debt Relief Factions (cont.) »

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  • http://knowdebt.org/services/credit-solutions Kevin Porter

    I really think it all comes down to who you talk to you. Just as you wouldn’t want a stranger walking through your home you wouldn’t want someone that you don’t know going over your financial situation and making personalized advice. Not that they need to be a close family relative, but it is good to do some investigating and really learn about a credit solutions agency before you choose to hand over your financial information and along with it your trust.

  • Pingback: Industry Group Brings Together Debt Relief Factions « Loan Consolidation Debt()

  • http://www.debtreliefindustry.com RK Osborne

    Thanks Gerri, for a well written and balanced article on the debt relief industry.

    You are right, there are a lot of competing factions but there is also a call for unity
    from many members of the debt relief industry. There are plans underway for the Evolution 2011 Debt Relief Conference on Aug 21-23, organized by movers in the industry who want to bring about cooperation for the sake of the consumer and survival of an industry. Not only is this a good opportunity to find improved methods to offer the consumer better value-added services with debt relief but also network with those who are making a difference in a positive way.

    I’d like to invite you to contact the organizers and cover a story about this historic
    conference.

    -RKO
    Correspondent and Publisher for
    Debt Relief Industry News

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