"Our Credit Counseling Nightmare"
by: Mr. & Mrs. consumer
Agency: HARBOUR CREDIT
COUNSELING SERVICES, Inc.
PO Box 9228
Virginia Beach, VA 23450-9226
(800) 887-2389

We entered into this program in September of 2000. Like many unsuspecting debtors, we were in desperate need of assistance with our high credit card balances and interest rates. Facing a lay-off we decided to seek the guidance of the non-profit credit counseling agency above. (I found their ad on the net and the guy I spoke with was at an office that was less than an hour from us. We expressed that we liked the fact that they were located within driving distance from us. We later found out that he was merely a salesman, and the true office was on the east coast. Nice. Anyway, the skinny of it goes something like this: We signed a contract that allotted certain monies (a specified amount) to be withdrawn from our bank account at a specific time of the month with amounts indicated as to the interest rates we'd pay yaddi-yaddi-yaddi, the standard corn everybody does. The "good" part begins after this, our accounts began to send notices that they were not receiving funds, or they were late, or that late fees were being accessed to the balances. I called our "advisor" who said this was standard on the first 3 months statements and that I should "relax" and let the whole thing run it's course. I was not convinced, but decided that maybe we were being too eager to get our credit going in a more positive direction. So, I did as the gentleman suggested and trusted that all would turn out if we just waited. Meanwhile, the statements kept rolling in. Stating that the accounts were being reported late. One in particular, we had only been late once prior with, had us concerned. But again we were advised not to contact our creditors directly, and to sit tight and wait. All this time our money is being with-drawn on time every month, same amount.

In January (4) months later, I decided to take matters into my own hands, enough was enough. I had received yet another batch of statements, and the interest rates on most of them weren't reflecting the agreed CC initial contract proposed with us. Most of them hadn't changed, and one of our accounts actually increased in minimum payment! I had "sat-tight" about as long as I was going to. I contacted my creditor who said that they didn't even have an agreed contract with my CC! The gentleman said they sent one in November (That was 2 months after I signed up to have our money withdrawn, as it had been, on time every month like clock-work.) He said they had sent payments, in the amount reflecting OUR contract with them, but that the amount wasn't enough. We were being reported late, and that they had sent another REJECTED proposal to them of the EXACT same thing! Wait, it gets even better. He (My credit card representative) also said that they never responded to the rejection, and that he could show absolutely no contact from them other than this. Hmmm. I was not feeling very "relaxed" at this point for sure. Time to call my "debt management advisor". I spoke with Shelly, who was new. She stated that my account had been "moved" to their office. (sold?) Anyway, she said that they had "misplaced" my records. And that it wasn't their fault. She assured me she would take care of it, and that this "should in no way adversely affect our credit. Hmmm. Well, as for the other accounts, there were problems also. For example, the account in which we had only paid late once, it now showed lates since September of 30 days with late fees. (Ironically since we signed up for our "debt-management). Inconsistent pays, incomplete payments, different amounts each time paid , you name it, our credit was really going down the tubes. But again, we were assured this was not the case, and that they would "fix" everything. The sales person I called offered to pay the late fees incurred, but only by "personal" check to us. I found this fishy, and declined asking as to why he would not just instead send the money to my creditors. After all, we are trying to "manage our debt" right?! He said this would be so much paperwork etc. Hmmm. I still declined the personal check, and asked him to clear it up instead for us, after all he is supposed to know how to "manage our debt". This phone call was not exactly ended on amicable terms. It also produced small results, if any.

I was "relaxing" while going through all our paperwork frantically trying to figure something out. I called all my creditors and explained, some even expressed sympathy for our situation and agreed to be patient. (Imagine that?! Credit card holders being "sympathetic", I knew then it was serious! "chuckle") I then spent many days on the phone tracking down the whereabouts of our original file that had been lost by them. (And no, I was not going to give up my only copy, I merely wanted to see if they even had looked at it before making their own decisions with our money. They tried to get me to send them a copy "to speed up the process", I said no way, no how and requested that they produce a copy of our file to add to our records. (By this point I wondered if they wanted to draft a new one by it, then say that they found it, or something equally underhanded. But of course, I have no way of knowing that, so decided to just hold on to it anyway for safe-keeping since they seemed have a habit of "losing" everything.) Plus, their file was supposed to have contained ALL their proposals to my creditors, etc. Very important. So far, that was the excuse for their being so ineffective was that the "last company" didn't do this or that, mainly they blamed them for not mailing our file. And when I would call the "last company" they would declare that they did this or that (including sent our files). And I would be exasperated and try again the next day, and again the next. (When they had initially advertised that they would keep us from receiving hassling phone calls, they failed to mention that we'd be having to make them instead?!) *sigh*

I finally came up with the idea of getting the "last company" and the "present company" on the phone in conference. This was rather humorous for the first hour as they blamed each other and each became rather defensive. I began to tire quickly though of the ineffectiveness of it all. This produced little but empty promises to "do whatever is necessary" to clear things up, as well as useless apologies from both. It did however, eventually produce the shipping number and verified receipt of our missing "files". Aha! so the new company had them in the building, but where was the great mystery. Our requested copies of those files never became available, or found either.

In March my husband had the very reluctant managerial task handing one-by-one out pink slips that eventually laid his entire department off. And ultimately he himself was laid off and closed the doors in March. (Due to the dot com industries ups-and-down's) I immediately relayed this to our CC and requested any options. I also requested that temporarily they not withdrawal the subsequent payment until he was re-hired and income was certain again. Up until this point, we had paid every payment as it had been drafted from our account, on the time agreed monthly. We had received a severance, but the budgeting was to be a mystery until he was hired on again with a new company. This was responded by hassled hurried responses that extended out little in the way of solution, not suprisingly. Their response was only that I had to stop payment at my bank, myself. Which I did, for a nominal fee. Their single follow up was with a letter that stated that I had to mail the payments from then on, because I stopped pay, that I was "disqualified" for EFT. "Fine". I thought. "Too bad they won't be able to keep a months worth of interest by withholding our payment and not paying our creditors again this month." I had began to suspect that was their reason, but didn't say it. Perhaps I was grasping for any signs of intelligence however applied from this company. After all, we were at their mercy to "clear this up". Of course I have no way of knowing what they were thinking or what were doing with our money. While I was being told to "relax" with our payments were being delayed during those months, naturally a mind would tend to wonder.

Up to that point, some accounts (I think only one, as best as we can interpret from the 3 credit reports that we sent for and received.) had actually been paid on time, but not for the full amount required to satisfy the lender. Each account was blundered - up in it's own unique way by Harbour. Like a hodge-podge of financial mess. Might I add, that the main reason we joined the "counseling" program was to establish "consistent" pay through the services lower payments long enough to be able to qualify for a loan with sanity. We have equity in our home, considered selling and buying a new home with the proceeds as well as pay off all this mess. We had hoped this would all time with the job situation improving. We had just needed time, my husband is in the same field and makes salary, so we thought this would turn out to be okay with the lender as long as we could establish history and buy out of the CC program when the time was right.

At the present, and since we stopped-payment we have not sent CC any more of our payments. We have since been working at figuring out and attempt solutions with our creditors individually on our own.

In the meantime, my husband got a great job, so I just left CC hanging, after all they didn't even call back to "counsel" with us after I had contacted them. And by the way, according to their "records" the late payment thing never happened, so they had said when I called them last. (I'll bet, since we all can guess what they were doing with those records, of course they reflect nothing!)

They eventually as of late have sent us a letter saying we are kicked-off the program. I had a tear in my eye, and I thought I noticed my husband getting a bit choked as well. (hee hee). But seriously, the real tears came with the credit report. And this is where we need advice BIG TIME.

Since our first CC payment in Sept of 2000, this is what the big 3 reporting agencies say:

(Before you read on remember, that we were "promised" that this was not being reported, back when we initially expressed our concern to CC. Also, that they stated that they would "extend every effort" to clear this up as soon as possible. But, we didn't see anything mentioned about that in the kicked-off-the-program letter, incidentally.)

Initially, right before entering the program the FICA was believed to be in the low 600's.We were informed by a not-going- to -lend-to-us-anyway lender recently that the FICA was now in the mid to low 500's. The lender explained that the majority of the negative factors have occured since September. He said if we could clear it up then they might be able to give us a decent loan. September, of course, coincides to the date when we signed up for the CC program. As this info is difficult to feasibly obtain first-hand for us to review personally, we have the choice to only believe the information from the reliable lender to be true concerning the FICA. We don't see any reason they would stand to gain from inaccurately informing us of this.

THESE BELOW ARE ONLY ACCOUNTS THAT WHERE LISTED WITH HARBOUR.

The following is the way the credit appears from the dates subsequent of signing onto Harbour's Counseling program. Those below dates range from 9-2000 when first payment by CC was withdrawn through March 2001 (when we stopped payment to CC).

Creditor X= open 8-1999/CURRENTLY past due 30 days. $XXX.XX amount. Past due as of 3-2001, 60 days as of 1-2001, 30 days as of 1-2001,2-2001,12-2000,11-2000. "Account managed by credit counsel service. That is the only time ever showing reported on this report, incidentally they were ALL acquired AFTER entering into the debt management program. Also note that our money was processed and drafted from our checking monthly on time every mid-month following until March of 2001. (We have our statements to verify this.)

Creditor Y=Open/Current, was past due 30 days.BEFORE Harbour there were 2/60's 4/30's total, but there had been 2 mos. of consistent pay before entering the program. AFTER Harbour:2/60's and 2/30's. (from 9-2000-3-2001).

Creditor Z= Status/Open/Current, was past due 30 days. 1/30 late since the program.

Creditor XX= 1/30 day since the program (October 2000) is the only late on this account reported at all. (acquired after joining the program.)

Doesn't seem like much until you count them up as 12 TOTAL 60 and 30 day lates on our various debt accounts. These particulars were accumulated following our signing up with the program. The severity compounds especially when considering we were only in the program for 7 months (Sept-2000-Mar-2001), and this is just where I stopped counting. 3 of those were 60 day, and we know what lenders think of that. That isn't including what the other 2 reports reflect, which looks even worse, from what we can ascertain from their readability, which can be cumbersome and difficult to decipher. I will try hard here give them the slight benefit of doubt that we may not be bright enough to read our reports correctly, in all fairness.*sigh* Maybe, rather I am grasping for hope that we are misreading them, but it isn't very probable. *sigh*

This is just a small example of our dilemma at this point. Is this what is supposed to be expected when folks need financial debt management help? Can they pay late and inconsistent and rack up late fee's and get away with it? I must say, (as a joke) that maybe this is a new debt-management coaching approach. I say this because since they have been worse at paying our bills than we were, it has helped us become better managers of our finances! Although, It seems that there could have been a more productive and rewarding way to learn financial skills than the way we had to!

We are currently in the lengthy process of writing the credit agencies and disputing etc.., for whatever good that will do, as the creditors were ultimately paid late even if it was because of them. It was conveyed to myself by one of our creditors, that "our finances are our responsibility, not theirs."(meaning consumer counseling services) When I heard that I felt like I had just twilighted back to 6th grade math class, when the dog really had eaten my homework! At least I have kept my sense of humor.*sigh*. We are also considering reporting to the BBB concerning the business practices of the CC. At least that will help so that other folks can be aware.

In having said that, what else can or should be done? I think for sure we could have acquired our new home, sold our current home and possibly could have had a clean slate had Harbour followed through on their commitments. It seems it would have been reasonable, as they suggest in their advertisements, to expect that we should have at least "improved" the credit's standing with the bureau's. But now we have compiled MORE credit problems with the "unwillingness to pay" history CC has given us, and even possible racked up and rolled-into-the-loan late fee's.CC added a WORSE set of circumstances to an already pre-existing set of select issues.

Drat!

Who pays for this? Who is ultimately responsible? Well that's the BIG money question, and of course the answer is that WE are going to pay figuratively and literally. And as so far as we can tell, probably for quite a while too. (As this stuff remains on the reports for quite some time, if they can't be removed).

Like many other folks do, we intended take responsible steps to get help to "manage" our financial circumstance by enrolling in the "program" in the first place. And then we did our part and paid timely to our program each month. We did so in good faith according to the contract agreement we signed. And the results were nothing like what we were lead to believe they would be.

Why would these bone-head's do this? Better yet, HOW do they stay in business doing this? Aren't they supposed to teach US how NOT to be financial bone-heads? Hence the "counseling" part of the services they say to provide!? ha!

Of course, I can't speak for all debt-management programs. But as for this program, it has been a most unpleasant experience.

To add even further "damage" to the credit, we now have the "CC" status on our reports, which many lenders view (so we have been informed) as almost the same as "bankruptcy"?! Is this true? Why should we suffer for seeking improvement when we did our part while they slacked and did "whatever" with our payments? They even paid different amounts than we agreed to each of our accounts, and even then those amounts didn't remain consistent. They shorted some of our accounts causing them to be partially paid, while over paying others, all the while without our prior authorization. It has been unbelievable! *sigh*

All this occurred as I called both lenders and CC on a very frequent basis trying to stop it from happening, the creditors admit to having records indicating this. This was in no way contributed to any lack of initiative to reasonably be involved on our behalf. So in short, I think it could have happened to anyone, and it's probable that it has happened to others in this particular agency.

We are (to say the least) not satisfied with the way things stand, here in the "aftermath" of our credit counseling.

We may consider seeking the advice a professional now to help us deal with our current credit frustration, "chuckle", but it certainly will not be the advice credit counselor/debt management company- that's for sure! I hope those days ended with the "kicked-off-the-program letter. "chuckle".

Thanks for your time in reading this, as such things seem to be in your area of expertness and interest. We were hoping you had some advice for our dilemma, or at least a few suggestions that may shed new hope on the situation. It has been rather refreshing to vent to a sympathetic ear, (other that our credit card companies that is, because we all know that won't last long! ) to say the least. "chuckle". So for that, we send our thanks already.

We want so much to get the loan to build our new home so that we can move. We have equity, just barely not enough to justify a ridiculous high rate pre-pay equity loan. Seemed like a good plan at the time to go with CC, get steady payments and income, sell the house, then take the equity and resolve the debt with still enough for a down payment, right? Well, as the saying goes about hind-sight, looking back it was not the optimum choice. Live and learn, we guess.

It seems to us now, that we would have been better off never even considering debt management. I am certain this does not happen to most people, with reputable companies. But I have a hunch that it's happening more than we know. This whole CC mess has been a waste of many family hours on the telephone, going through credit reports, the current hassles of figuring out how to get all this worked out, frazzled nerves, and worse credit problems. I still think that the late fee's are on our tab to boot, (checking into that.)

I hope this letter at least helps you know how it's going for this Mr. & Mrs. debtor USA, maybe it will help others avoid potential pitfalls. If you have any advice or suggestions, by all means pass them on, as the would be GREATLY appreciated.

Add one last question: Our CC was supposedly a non-profit agency. If they aren't profiting, and we certainly aren't profiting, then who is?

I'll bet I can guess who.

You have brushed on it in recent postings and we would be interested and delighted to hear more about who you think really profits from these "not for profit" programs. To phrase it more precisely, in your opinion, who ultimately profits from all this nonsense?