Debt Relief Solutions- Debt Relief Came Right after the Creation of Credit
*Epic Debt Relief works with debt settlement and negotiation, not credit counseling of any kind. The information in this article is for educational purposes only to allow consumers to make informed decisions about their debt relief solutions.*
Dating back to the 1920s, unsecured credit lines and credit cards were issued to consumers. Once people started borrowing, they almost immediately started defaulting on their credit for various reasons. Because of this, the development of the National Foundation for Credit Counseling happened in 1951 and created some of the first formal credit counseling companies. This organization was founded to help creditors like department stores and other companies to recover the money that was owed to them from delinquent accounts and prevent consumers from having to file bankruptcy. Starting in the 80s, credit cards and the use of credit became much more popular, as did the need for credit counseling and other debt relief solutions.
In 1993, the Association of Independent Consumer Credit Counseling Agencies (AICCA) was formed. This organization was created to offer other options for consumers who didn't like the face-to-face or professional approach that came from the credit counseling done by companies within the NFCC. Even today, many credit counseling services offer phone consultations and online program enrollment options. The largest organization within the credit counseling industry is the AADMO, or American Association of Debt Management Organizations.
In the early 2000s, federal and state regulating agencies began looking at credit counseling agencies with much more scrutiny. The companies were challenged to be more professional and credible, and Ameridebt was actually sued by the Attorney Generals of Texas, Missouri, and Illinois and the FTC (Federal Trade Commission) for misrepresentation. After this, many non-profit companies were investigated and subsequently lost their non-profit statuses for misrepresentation of their duties and company obligations. In 2005, bankruptcy laws changed and created a mandatory credit counseling session for anyone filing bankruptcy.
This type of debt relief does have a high failure rate because consumers rarely are able to follow the rigid plans, but it still remains an important part of the credit industry and will into the indefinite future. There are other debt relief solutions out there to choose from, but credit counseling is one option that consumers have.
To learn more about bankruptcy alternatives and debt relief solutions, contact Epic Debt Relief today at 877-971-3232.