AICCCA Press Release

As Demand for Credit Counseling Services Jump, Consumers are too Slow to Ask for Help

Fairfax, VA - April 5, 2010 — Association of Independent Consumer Credit Counseling Agencies (AICCCA) member offices report a sharp rise in the number of consumers seeking help with debt due to high interest rates, reduced incomes and overspending. Many offices have seen as high as a 15 percent increase in consumers seeking help for these factors.

In addition, the number of people whose debt problems are too dire to be helped by credit counseling has increased by more than 10 percent. Lack of adequate income and waiting too long to seek help are the two main reasons for the increase in persons who are unable to solve their problems with credit counseling. This leaves bankruptcy as one of their few options.

"The major tipping point for people seeking help from our member offices varies depending on the current economic conditions," said Dave Jones, president, AICCCA. "But the underlying cause for most consumers who seek help is the lack of a household budget and poor money management skills. If consumers have a better plan for expenses and seek help earlier, they will be more likely to avoid financial problems."

AICCCA provides three early warning signs to seek credit counseling assistance:

1. No savings for unexpected expenses or emergencies. To avoid unwanted debt that can cause havoc with a family's finances, save six to 12 months of living expenses in a dedicated savings account.



2. Any disruption in income would cause immediate problems meeting monthly obligations. Develop a budget that leaves enough money to save for emergencies and those extras that you want without relying on credit.



3. Can only afford minimum payments on large amount of debt. Adjustments in household spending to increase payment amounts on unsecured debt will help avoid defaulting on the debt.