National Foundation for Credit Counseling (NFCC)

What Is the National Foundation for Credit Counseling (NFCC)?

The National Foundation for Credit Counseling (NFCC) is a national network of non-profit credit counseling organizations. One of the primary services given by NFCC member agencies is counseling individuals who have taken on too much debt, determined to hold them back from proclaiming bankruptcy.

To accomplish this objective, NFCC members frequently suggest that their clients take part in a debt management plan (DMP), in which the client makes a single regularly scheduled payment to the NFCC member, who thusly utilizes those funds to repay the client's debts.

A central assumption of the DMP strategy is that the NFCC member will effectively haggle more flexible debt repayment terms with the client's creditors, which might possibly be true in practice.

Lamentably, some unethical credit counseling firms have been known to make unreasonable or misdirecting vows to their clients, putting them in an even more terrible financial position. Likewise, the NFCC attempts to keep up with standards of ethical conduct inside the credit counseling industry.

Figuring out the NFCC

Established in 1951, the NFCC has developed to address member agencies in each of the 50 states, including the District of Columbia and Puerto Rico. The NFCC acts as an organizing body for its member firms, while likewise campaigning the United States government for the credit counseling industry.

While dealing with its member firms, the NFCC's primary obligations comprise of accrediting individual firms and giving training and different resources to new debt counselors.

To keep up with their NFCC accreditation, member firms must guarantee that their staff is satisfactorily prepared and that annual [audits](/criminological review) are completed concerning their operating and trust accounts. NFCC member firms must likewise give progressing consumer education programs while exhibiting that any funds held in the interest of clients are by and large routinely dispensed to those clients' creditors on a biweekly basis.

In recent years, some consumer guard dog organizations have condemned the credit counseling industry for its supposed abuse of a few vulnerable customers. Notwithstanding unequivocally fraudulent organizations that acknowledge clients' money and don't give it to their creditors, some apparently real credit counseling agencies don't clarify that their services are frequently not free for the end-client.

True Example of the NFCC

Emma is attempting to repay her debts and is seeking the assistance of a credit counselor. She learns through the website of a NFCC-accredited credit counseling company that the firm is a non-benefit that offers types of assistance, for example, credit score surveys, exhortation on the most proficient method to stay away from foreclosures, data on the most proficient method to dependably utilize products, for example, a reverse mortgage, guidance on student loan repayment plans, and assistance through DMPs.

Through her work with the company, she can pay off her debts, each manageable regularly scheduled payment in turn.

Features

• The National Foundation for Credit Counseling (NFCC) is a membership organization addressing the interests of credit counseling firms.
• The NFCC gives educational resources and accreditation to its members while campaigning Congress for the industry.
• While it is rare, consumers ought to know that some corrupt credit counselors could look to take advantage of customers into acting against their best interests, for example, by clouding their fees or exaggerating their own abilities.