It was 2004 and the Hilderbrandt family of New Richmond, Wisc., was drowning in debt. Personal loans and credit cards added up to a staggering $106,000.
Last week Russell and Kathy Hildebrandt, along with their three children, were honored by the National Foundation for Credit Counseling because, after five years of hard work and sacrifice, the Hildebrandts have paid off their charge accounts and credit cards and, aside from their home mortgage, are debt free.
How did they do it? Well, it wasn't by signing up with one of the countless “debt settlement” companies that advertise on radio, television and the Internet. In fact, the Hildebrandts didn't settle their debt, they paid it off, the old fashioned way.
They eliminated all discretionary spending. They bought clothing at thrift stores, eliminated gifts, and purchased only generic and store brands at the grocery store.
Russell took a second job at night, getting by for a couple of years on minimal sleep. At first they were barely making a dent in their debt, but as they paid off one balance, they applied the monthly payment to another, until they paid it off.
The family was honored with the Professional Achievement and Counseling Excellence (PACE) 2009 Graduate Client of the Year Award. The award, given by the National Foundation for Credit Counseling, recognizes hard work and commitment to repaying their debts, and a willingness to become effective managers of their money and change their lifestyle.
The Hildebrandts found a certified credit counselor by contacting NFCC, which has been around since 1951 and monitors the training and ethical behavior of its members. With so many scammers moving into credit and debt management services, consumers must be extremely careful when selecting someone to assist them with their debt.
“If all they want to talk about is a debt management program, hang up and keep looking,” said Gail Cunningham, Vice President of NFCC. “Any legitimate counselor needs to have many resolution options in their tool bag.”
If a prospective credit counselor makes the process sound easy and painless, that's another red flag. As the Hildebrandts found, getting out of debt is hard work. However, it beats falling for an easy-sounding program that turns out to be a scam.
“The last thing someone needs when they're struggling financially is to fall into the hands of a disreputable credit counseling agency,” Cunningham said.
Cunningham said reputable counselors are certified, are affiliated with national organizations, and charge little or nothing for their services. That last point is key, as scammers are totally in it for the money, and demand large, upfront fees for their supposed help.
Copyright 2009 consumeraffairs.com
