Frequently Asked Questions (FAQs)
Have you ever had a question and didn’t know where to find the answer? If so, you’ve come to the right place. This section is a compilation of answers to the questions most commonly asked by our clients. If you can’t find the question you wanted to ask, don’t hesitate to contact us.
- What classes do you offer?
- What topics do you teach?
- What is the cost to attend one of your seminars?
- I would like to schedule a CCOA education speaker for my school/business/organization. How can I do that?
- What does the 8-hour homebuyer education course cover?
- What are the income guidelines for homebuyer assistance programs?
- What happens in a counseling session?
- I'm having trouble making payments to creditors. What should I do until my appointment?
- Can I use a credit report to get started on the Debt Management Program (DMP) instead of creditor statements?
- In what languages does CCOA provide services?
- Can CCOA stop legal action?
- I received my datasheet, but do I really need to fill it out before my session?
- Do I have to put all my creditors on the Debt Management Program (DMP)?
- Can you assist me with an account that has been turned over to a collection agency?
- How can I reach my counselor to speak to him/her?
- Will my employer or creditors know I have an appointment?
- If I am living with someone, but not married, can we both be on the same Debt Management Program (DMP) together?
- Do I have to be behind on my payments to start a Debt Management Program (DMP)?
- How do I select a Credit Counseling Agency?
- Why should I choose a Credit Counseling Agency over a Debt Settlement Company?
- What will the Debt Management Program (DMP) do to my credit?
- Will I be able to obtain a home loan or a vehicle loan while on the Debt Management Program (DMP)?
- Does CCOA report late pays to the credit bureaus?
- How can I improve my credit?
What classes do you offer?
"Master Your Money," "Master Your Credit," "Identity Theft," "Credit Score Secrets," "Homebuyer Education," "Managing Your Stress & Time," “Holiday Spending: Money & Stress Tips”"Couples & Money Matters," "Financial Freedom," "Raising Money Smart Kids," "Divorce & Your Credit," plus classes for high school and college students on money and credit issues. For a full listing of classes or to register for a class, go to the Education page on our website.
What topics do you teach?
CCOA has a wide variety of topics, including: money management, credit basics, credit scoring, holiday spending, divorce and credit, and couples and money.
What is the cost to attend one of your seminars?
All of CCOA's seminars are free, with the exception of the 2-hour bankruptcy education seminar. However, a fee is charged for education at for-profit businesses (unless it is an employee run lunch & learn, for example, and not an official company sponsored function).
I would like to schedule a CCOA education speaker for my school/business/organization. How can I do that?
Contact Mark Foster, Director of Education, at firstname.lastname@example.org, (479) 521-8877 or 800-889-4916 to schedule a financial class. Classes are presented in the Northwest Arkansas and River Valley areas based on educator availability.
What does the 8-hour homebuyer education course cover?
Homebuyer education classes cover shopping and making your application for a home, shopping and applying for a home loan, homeowner's insurance, credit, family budgeting and preparing for life as a new homeowner. It is a broad overview of the home buying process.
What are the income guidelines for homebuyer assistance programs?
Income guidelines will vary depending upon what type of assistance an applicant will qualify, size of family and the county in which you live. The income guidelines are set by the Arkansas Development Finance Authority (ADFA) and are subject to change. For the most current listing of the income guidelines as well as program descriptions, go to the ADFA's website.
What happens in a counseling session?
During the session, a trained, professional credit counselor will help you clarify your financial goals, analyze your income, expenses and overall financial situation, discuss possible solutions, and make recommendations for you to consider. The counselor will not tell you what to do. S/he will offer recommendations and help you explore options. Ultimately, you will have to decide on the course of action you wish to take.
I'm having trouble making payments to creditors. What should I do until my appointment?
Continue paying your priorities -- rent/mortgage, utilities, car note, insurance, taxes, student loans, secured debt and other bills as best you can. Communicate with our creditors and let them know you have an appointment with CCOA. Do not refuse to talk to them and do not make any promises you can't keep.
Can I use a credit report to get started on the Debt Management Program (DMP) instead of creditor statements?
Your credit report is a good source for information about creditors you owe money to. It is not necessary for you to have a credit report unless you don't know your creditors. While the credit report is useful, it is not an adequate substitute for creditor statements. Credit reports seldom have full account numbers and payment mailing addresses for your creditors. This sort of information is vital to get started on the program.
In what languages does CCOA provide services?
Spanish, Marshallese and English.
Can CCOA stop legal action?
In the majority of cases, CCOA is able to work with creditors toward a positive solution that will satisfy everyone and hopefully stop any legal action. Most creditors prefer money to legal action, provided that regular payments are being made on the account. However, utilizing CCOA's services does not interfere with the terms of the contract you signed when credit was extended and creditors may choose to enforce the terms of the contract to protect their interests. Furthermore, CCOA cannot stop court fines or tax garnishments.
I received my datasheet, but do I really need to fill it out before my session?
A request for personal and account information is sent to you so you will be prepared for the counseling session. You will need to provide this information in the session, so completing the form will assist in this effort. Our ability to help you and provide useful advice is greatly enhanced if you complete the datasheet before your session. We ask that all clients read and sign the back two pages before coming to the counseling session.
Do I have to put all my creditors on the Debt Management Program (DMP)?
We recommend that you put all of your creditors on the DMP. This will assist in your effort to become debt free at the earliest possible time. However, an exception to keep one credit card off the program for business/emergency purposes can be considered. If a card is kept off the program, we strongly urge you to pay off the outstanding balance monthly. Since creditors frequently monitor open or added accounts and upon finding such accounts may discontinue concessions, we suggest you discuss this exception with your counselor during the initial counseling session.
Can you assist me with an account that has been turned over to a collection agency?
Yes, in most cases. Sometimes, the original creditor will pull the account back from collections, so that we'll be working again with the original creditor. At other times, we have to work with the collection agency. Collection agencies like to get money. We try to show them that they will get a steady stream of payments if they accept a DMP proposal. They will often require a higher monthly payment than the original creditor does, but they will usually accept DMP payments. Furthermore, your counselor can also inform you of your rights under the Fair Debt Collection Practices Act, which governs the activities of collection agencies. Once they know you are aware of your legal rights, collection agencies are less likely to use their most heavy-handed tactics.
How can I reach my counselor to speak to him/her?
Counselors are booked with appointments throughout the day. As you can imagine, they cannot pause in the middle of a counseling session to take phone calls. That would be unfair to the client in the session. As a result, counselors usually have to try to return phone calls between sessions, or if a client fails to show for an appointment. We understand that can be frustrating, so we try to offer alternatives. You can always reach your counselor if you schedule a Review session (once you've started the DMP), or a Recounsel session (if you are not actively enrolled in a DMP). The sessions can be set up as in-person or phone appointments (whichever you prefer). If you want to schedule an appointment, or if you have questions about any aspect of your DMP, we strongly urge you to talk to one of our Client Support Representatives (CSRs). They are a great team, trained to answer your questions. It is likely that you'll have answers to your questions much more quickly if you let the CSR team help you than if you insist on speaking to your counselor. If the CSR is not able to answer your question, she/he will try to have your counselor call you back as soon as possible.
Will my employer or creditors know I have an appointment?
No one will know you have an appointment unless you tell him or her. If a creditor calls, we will assume it is because the creditor referred you to us. We will only verify the appointment you made with us.
If I am living with someone, but not married, can we both be on the same Debt Management Program (DMP) together?
Yes, that is possible. Furthermore, entering into a shared DMP does not create a legal obligation for the other person's debt, if the accounts were not shared (joint) prior to the DMP start. Though we can create such a combined DMP, keep in mind that splitting a DMP can get sticky. So you don't want to enter into a shared DMP on a whim.
Do I have to be behind on my payments to start a Debt Management Program (DMP)?
No, you do not. However, this may be an issue worth discussing with a counselor. Several creditors now look for indications that you are facing financial stress before accepting a proposal. Such indicators could include making late payments, or being close to or over limit on your account. The vast majority of creditors do not have these requirements. Still, a DMP is serious "medicine" and should only be used after thoughtfully weighing all available alternatives.
You already have!
There are many different counseling agencies offering their services, and it can be difficult to determine which one to choose. However, third-parties, such as the National Consumer Law Center and the Federal Trade Commission, have come out with some guidelines to help consumers assess the quality of the counseling agencies they are considering. For a few specifics, click the question to pull up a flyer about how to select an agency.
Why should I choose a Credit Counseling Agency over a Debt Settlement Company?
Since some people want to explore debt settlement as an option, they might also want to look at the report the NCLC did on debt settlement agencies before they make up their mind. It's not particularly flattering, to say the least. Even if you found a reputable company, settling a debt for less than you owe can greatly hurt your credit and the IRS may tax you on the forgiven debt as earned income.
What will the Debt Management Program (DMP) do to my credit?
Simply talking to one of our counselors will not impact your credit. We start with a budgeting session. More than two-thirds of the clients who talk to our counselors do not use a Debt Management Program (DMP) to make ongoing payments to their creditors. We help them explore a variety of options, and for most clients, the DMP is not the best tool to address their concerns. Note that the use of a DMP will not, by itself, impact your credit score.
Liz Pulliam Weston, who writes a column for MSN Money, addressed this in an online article. Going on a DMP is not looked at as a negative action, so FICO credit scoring company does not take points off of your credit score for that. Also, as you pay your debt down on the DMP, you will find that your credit score will go up!
Will I be able to obtain a home loan or a vehicle loan while on the Debt Management Program (DMP)?
There are two possible questions here: 1) Will CCOA stand in my way if I need to get a new car, or want to get a home loan? 2) Will being on a Debt Management Program (DMP) prevent me from getting an auto loan or home mortgage?
In answer to the first question, no -- CCOA would not stand in your way if you needed to replace a worn-out vehicle, or if you were able to fulfill the dream of homeownership. We would probably advise caution, and make sure that you didn't try to buy more car or home than you could afford. We'd want to make sure the purchase could fit within your budget. We could even be a resource, helping guide you through the purchasing decision. We keep up on issues like this, and we gladly share that information with our clients.
The other question is whether being on a DMP will prevent you from getting a car loan or home mortgage. Fair Isaac (fico), the largest credit scoring company, has assured us that they view participation in a DMP as a score-neutral factor; it neither raises, nor lowers your credit score. Furthermore, we do not report your participation to any of the credit bureaus. However, some creditors may add a notation to your credit reports, indicating that you are participating in a DMP. Some potential lenders (auto or home mortgage) may see that as a positive step (taking responsibility for your debts), while others may see it as a negative indicator (breaking from your original credit contract). Those who view it as a negative may be reluctant to approve such a loan while you are on a DMP.
Ultimately, the auto and mortgage lending businesses are very competitive. We'd recommend you shop around. If one lender declines your loan application, shop around to get other opinions. The bottom line is that we do have DMP clients who apply for, and obtain, car loans and mortgages while participating in the DMP.
Does CCOA report late pays to the credit bureaus?
No. CCOA does not report to the credit reporting agencies. However, your creditors may continue to report late payments and past due amounts to the bureaus on their individual accounts. Furthermore, some creditors may notate that you are paying through a counseling service.
How can I improve my credit?
The two most important tips are 1) Pay your debts on time, and 2) The less debt you owe, the higher your score. These two factors make up 65% of your credit score. Late payments can have a severe negative impact on your score. Once you've missed payments, all you can do is make future payments on time, and wait until the late-payment blemish lessens over time.
Credit scoring companies measure the amount of debt you're carrying compared to the credit limits on your accounts. You want to avoid being close to, or over your credit limits. In fact, it's best to be using only 25% or less of your established credit on any given account. Three other factors impact your credit scores. You can get more information on credit scores and tips to improve them by visiting Fair Isaac's website (www.myfico.com), where they have some useful educational material. The Federal Trade Commission (FTC) also has some great information on the subject at their consumer site. Their page on credit reports and scores can be found at: http://www.ftc.gov/bcp/conline/edcams/credit/coninfo_reports.htm.
CCOA offers a credit report review service. A counselor will sit down with you, pull a copy of your Equifax credit report (with credit score), and review the strengths and weaknesses with you. The counselor will also give you personalized advice on how to take steps to improve your score. We only offer this service in-person. We also point out that you are entitled to get a free copy of your credit reports once per year from each of the three major credit-reporting agencies. You can access your reports at www.annualcreditreport.com or by calling 877-322-8228.