It is a goal of the Online Lender Alliance (OLA) and our members to improve the financial health of consumers. Financial health refers to the state of one’s current financial situation. This may include: the amount of savings you have, retirement funds, and how much income you are spending. There are plenty of resources out there to help you, however we recommend the Youth and Adult Financial Education toolkits offered by the Consumer Financial Protection Bureau (CFPB).
Consumers with overburdened debt loads often find themselves turning to credit counseling agencies for help. Credit counseling provides the consumer with financial education, budgeting techniques and the tools to get out of debt.
When appropriate, the credit counseling agency will enroll the consumer in a Debt Management Plan (DMP). With the approval of the consumers’ creditors, the consumer is enrolled in a repayment plan that will pay back the debts in full. In return, the consumer will likely receive a reduction in interest rates on their debt as well as the cessation of late fees. Plans are typically set to be repaid in five years.
Consumers who fall behind on one debt often fall behind on multiple debts. Credit counseling agencies can walk you through a budget to ensure you can afford the payments for the loan you are looking for. Credit counseling can also be a way to help you get back on track if you have fallen behind on payments and pay back outstanding debts.
Next time you think can use the help of a credit counseling agency, please visit the Financial Counseling Association of America (FCAA). All FCAA member agencies are accredited, licensed/registered as required by law and abide by strict FCAA standards. 1-800-450-1794 will direct you to an agency licensed/registered to work with consumers in your state.