National Foundation for Credit Counseling
The National Foundation for Credit Counseling (NFCC) accredits debt counseling agencies with high standards, high ethics, certified counselors, and policies that help consumers achieve financial stability.
Consumers with difficult credit issues will find low-cost assistance.
The NFCC includes over 100 member agencies and 900 offices across the nation. Most NFCC member agencies are considered Consumer Credit Counseling Services.
Predatory Lending
Predatory lending usually means a secured loan made by a lender that knows the borrower won’t be able to repay them. They then sieze the car or home and sell it. The practice involves some deception on the part of the lender. Some of the practices of predatory lending are illegal in many states.
Other types of loans that may be considered predatory are credit cards, payday loans and any other loan where the interest rate is unreasonably high. Predatory lenders usually target lower income minorities and the elderly.
Predatory borrowing can refer to borrowing with no intention of repaying, submitting fraudulent loan applications and lying about income.
Debt Negotiation
Debt negotiation is the process of negotiating a reduction in loan or credit card balance. This usually will not begin until you are late on payments. It is also possible to negotiate fees and interest.
Any loan or credit card account can be negotiated. You can do it yourself, you don’t need a lawyer or debt settlement company. Other negotiated items include the information reported to the major credit reporting agencies.
Debt settlement companies are considered predatory by many.
Debt Consolidation
Debt consolidation is a debt repayment program. There are several benefits to consumers, including getting a lower interest rate and the convenience of making only one monthly payment. Debt consolidation is primarily used to pay off credit card debt, which usually is financed at a higher interest rate.
Typically, the debt consolidation company will negotiate the repayment terms, interest rates and fees for each of your accounts. A single monthly payment is then made to the debt consolidation company.
Debt consolidation loans involve moving unsecured credit card debt to a secured loan with collateral, usually your house. Failure to pay allows the lender to foreclose on your home. These loans usually have steep fees and some may be predatory.
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