It?s a credit counseling Battle of the Bulge.
With an estimated 14.44 percent of U.S. subprime mortgages in default and 1.8 million of them about to reset at 30 to 50 percent higher monthly payments, one local credit counseling mainstay is deploying to the threatened front.
“We are becoming certified by HUD to perform housing counseling, so we can become approved to provide that service through the Hope Now Alliance,” Consumer Credit Counseling Service of Maryland and Delaware President Jim Godfrey said of his nonprofit?s move to join the homeowner rescue plan recently announced by President Bush.
“The need is so great now that we?ve been encouraged? to enter this type of counseling,” Godfrey said. The 75-employee, $6-million-a-year agency currently specializes in consumer credit counseling and financial literacy education for consumers and public school teachers.
There are an estimated 7.2 million Americans who hold subprime mortgages; and President Bush has asked Congress for $170 million to fund ramped-up alliance qualifying of those presented for possible restructuring or a five-year interest rate freeze.
“They?ve performed very well,” said Maryland Council on Economic Education Executive Director Mary Ann Hewitt of CCCS. “We?ve had a partnership for over 10 years. As a result, we?ve trained thousands of teachers [in financial literacy].”
“We help people understand where their money is going,” Godfrey said, noting that lack of budgeting, the “buy now, pay later” attitude, and insufficient personal savings are the main reasons for indebtedness. “We help them develop budgets and cut back on expenses.”
CCCS?s staff does this for 30,000 consumers a year, up 15 percent over 2006, through telephone or in-person counseling at 10 branches, Godfrey said.
Currently, subprime mortgage-stressed callers are referred to a certified housing counseling service ? after being helped with consumer credit issues.
“More than likely, the lack of education and budgeting are the very reasons they got into the subprime situation,” said CCCS?s Director of Counseling Nina Heck.
Both advised that impatient counselors and heavy or front-loaded fee schedules are indications of disreputable credit counseling firms.
Consumer Credit Counseling Service of Maryland and Delaware
757 Frederick Road,
Catonsville, MD 21228
1-800-642-2227;
www.cccs-inc.org
