“Help With My Credit”—A Good Consumer Tool?
Many credit cardholders a having difficulty making their credit card payments. Today, a group of financial institutions and credit card issuers are launching Help With My Credit to educate consumers about debt and assist with credit card payments.
Help With My Credit provides a toll-free telephone number ( 1-866-941-1030 ) for consumers to call with credit card and debt issues. Operators will listen to the consumer and provide information about contacting credit card issuers and accredited credit counseling agencies. Consumers can also get help and information through a website, HelpWithMyCredit.org. (http://www.helpwithmycredit.org)
Help With My Credit is supported by Bank of America, Capital One, Citi and Discover Card, and also by payments networks MasterCard and Visa. They will promote Help With My Credit with a national advertising campaign.
Experts say that this is a good idea and will be helpful for cardholders who are already in debt. However, in some cases, it is the punitive practices of the credit card issuer that helped get these consumers into debt trouble. For the past few years, issuers have been looking for reasons to increase interest rates and gave themselves permission to raise rates at ‘any time for any reason’.
The downside to issuers of charging 20-30% interest rates is that it pushes consumers to the financial edge, possibly to the point of defaulting on loans, experts say. To some, this seems like somewhat of a self-serving program for credit card issuers.
Because credit card loans are unsecured, as the number of defaults and bankruptcies increase, issuers are losing a lot of money. Help with My Credit is designed to help cardholders pay off their credit card balances instead of defaulting or declaring bankruptcy.
Consumers who use Help with My Credit to help debt problems will be offered the opportunity to be transferred directly to the credit card issuer, or to an accredited counseling agency. Consumers will be referred to one of three national counseling agencies: Money Management International, Novadebt, and Take Charge America. Each of these are non-profit agencies that are accredited by the
National Foundation for Credit Counseling and/or the Association of Independent Consumer Counseling Agencies. They are licensed and operating in all fifty states.
Financial experts advise that Help With My Credit is a good tool for cardholders who are overwhelmed or struggling with debt and don’t know what to do or the first step to take. They say the only way to start climbing out of debt is to admit the problem and start tackling it, and that maybe Help With My Credit will be the first step to help some consumers climb out of the terrible debt trap.