How Credit Counseling Helped My Family

Phyl Campbell By Phyl Campbell, 2nd Aug 2013 | Follow this author | RSS Feed
Posted in Wikinut>Money>Debt

When my family had over $40,000 credit card debt at over 25% APR, we didn't know how we would ever get out from under it. With help from a credit counselor, we set up a Debt Management Plan and paid off the debt in 3 years. I got the opportunity to speak to CCOA counselors about the experience as a program graduate.


In October of 2009, my husband and I walked into the CCOA office with $40,000 in revolving credit card debt. In November 2012, it was paid off. Three years. To pay off $40,000 dollars. And in that time, we didn’t miss a payment on our house, our utility bills, our student loans – everything stayed current. I’m not saying it was always pretty.

I’m not even going to tell you we’re debt free now. We have a credit card, a medical account I used to pay for LASEK surgery, and a car note. And we’re just naming my husband’s student loan, because "Bob" is going to be a member of our family for a long, long time.

So if we’re still in debt, what did we learn from the program? That’s a good question. There are people out there who grow their own food, sew their own clothes, and never eat out at restaurants to pay off the same kind of debt we have. And more power to them. There are people who can’t find work or just never find a way out of debt. I think most families are like mine, somewhere in the middle. I just knew that what I needed for my family was something a little different. And CCOA was that something.

(Photo Credit: Mark Foster -- Thanks, Mark!)


I’m sure you want to know how we managed to accumulate so much debt. And the easy answer to that is high interest rates. The more complicated answer, of course, is “life”:

My husband had a tenure track position at a major university. The only way to lose that, so we were told, was through gross negligence. So when I got dropped out of my master’s program to be a Mom, it was no big deal. When we bought our first house, a major fixer-upper in a nice neighborhood, we knew we’d have plenty of time to fix it and flip it. We were a young family with a little kid living the American Dream.

And then my husband got laid off. Budget cuts or the wrong side of politics, whatever the reason, time was no longer on our side. We hired a realtor, followed his advice on fixing up the house for a quick sale, packed up our stuff, and moved back to Arkansas and in with my parents. I promised them that we’d just be there for the summer and then the house would sell and we’d get our own place. That quick sale turned into 7 long months. And we lost our shirts. The money we were counting to recoup in the sale of the house never materialized.

Neither did the contracts my husband hoped to secure with his own business. He talked to several banks about business loans, but we had too much credit card debt. And like sharks circling in the waters, the interest rates on those cards kept going up. Our balance to limit ratio was too high, so we were charged a higher rate.

Do you know what the minimum payment is on $40,000 of credit card debt is at an interest rate above 25%? We did. Intimately. And we were stuck on this idea that we deserved our fate. That as bad as it was, we had signed the deal and agreed that the credit card companies could charge us whatever they wanted. The credit card companies told us we that if we defaulted, they could help us, but they wouldn’t lower our interest rates. If we didn’t like it, we could close the accounts and pay the balances in full at any time. Like that was going to happen.

(Photo Credit: morgueFile)

Late night scam-verts

We had looked into other services that claimed to settle debts or rebuild credit. But we were leary. We saw the CCOA commercial, but it just sounded too good to be true. So we plugged along, digging deeper and deeper. And I kept seeing those CCOA commercials late at night, and thinking “wouldn’t it be nice if they weren’t a total scam?”

We got a slight reprieve in the summer of 2009 when Sean’s university retirement fund came. We had been told that he wouldn’t get it, and we were worried that if we waited, we wouldn’t get anything. So we took the 65% penalty for cashing out early, paid off my dying car and a credit card.

Then that fall, Sean and I took a half-day off work and went to see Mike Witte, who would become our CCOA counselor. I brought in my budget, which, while certainly creative, had kept our family going for nearly seven years. I just knew there would be some caveat – some requirement that we wouldn’t meet and we’d just have to keep on like we had been. Mike was unbelievably patient. He gave Sean and I the forms to start the process. He alerted us to possible problems – AHA! I thought. I knew it! But despite his letting us know worst case scenarios, every creditor agreed to let us be on a DMP – CITI, CHASE, Discover, and the notorious Bank Of America. Every company that told us “no” told CCOA “yes.” Our interest rates were cut in half. We were flabbergasted.

My last credit card purchase before CCOA was for a new A/C unit for our house in 2009. I maxed out every single card that I had. On purpose. Then I quit using them.

That night, we put away the credit cards, completed all the forms, and then we waited. Waited for the cycle on our first payment. Waited for the letters to tell us our account had been accepted for the DMP. Waited to see how it wasn't going to work. Because we just knew that it wasn't going to work and we were the biggest suckers of all time.

(Photo Credit: <img src="" width="303" height="303" border="0"><br>Photo credit: <a href="">DuBoix</a> from <a href=""></a>)


But CCOA wasn't a gimmick, and we weren't duped. We had been paying over a $1000 a month – over at least 4 four years -- just to make minimum payments. Mike’s DMP (Debt Management Program) for us cost $770 a month to have our debt paid off in five years. Using what we had already budgeted, money we saved, and some snowballing techniques, we did it in three.

CCOA was helpful in another way. Before CCOA, I tried everything to make sure I didn’t miss a payment – auto-debit services, e-mail reminders. But the card companies’s automated services would send me messages that I hadn’t paid. So I would make a payment. Then, they’d take an automatic payment out of my account. We would call the customer service line, just to get the run-around. It was awful. Any excuse to jack up rates was good enough for those vultures. Not that I'm bitter.

But on the DMP with CCOA, I forwarded those notices to Mike. He’d reply not to worry and he’d look into it. And it was always fine. Being able to pass the responsibility to someone else -- someone who wasn't trying to defend him or herself against a major corporation – was wonderful. I sent Mike over 100 e-mails in those three years. It felt like I was somebody with a lawyer on retainer – but a lot more economical. When Mike told me everything was fine, I learned to believe him. I hadn't realized how long I'd been holding my breath. I got to live life instead of worrying about it.

I was able to save money by quitting my jobs and taking my son out of after school care. This cut gas expenses, eating out, and child care. I became a volunteer. First, at my son’s school, then with a local literacy council. I spent a year in service to Americorps, which paid off the rest of my student loan.

Family Improvement

My wonderful and supportive husband continues to work for an amazing company that has allowed him to use his PhD and play in the dirt. We are a better team today than we have ever been. There are still things we want, and we still struggle, but we are closer to our goals and each other than ever.

One example of his support is the time he’s afforded me to write. In the past two years, I have written and published two novels – and I have a third coming out in August. They’re on Amazon – you know you want to get them.

I qualified for LASEK surgery after 25 years of glasses and contact lenses. There are no words to express how happy I am to have had that surgery. I thought it would never happen.

We replaced the car that died in the school parking lot at least 4 times a week.

We breathe.

Plans from here - and debt as part of life

And we’re putting our current house on the market again – looking at an opportunity for my son to move within walking distance of his schools and friends; hoping that this time the things we learned from our last experience will help us do better.

Being debt free is a wonderful thing for some people. But in the way our society works, credit and the right kinds of debt are important. Dave Ramsey talks about not taking out a loan for a car -- but would you buy your car’s gas a year in advance? Some people talk about owning their homes free and clear, but would they pay taxes and utilities for their lifetime up front? It isn’t the way our economy works. But with knowledgeable people able and willing to support us, our lives became a more practical set of expectations and goals than some abstract American Dream. CCOA definitely helped get my family on the right track.


Budget, Ccoa, Credit Card, Credit Card Debt, Credit Cards, Credit Counseling, Credit Debt Help, Debt, Debt Management, Debt To Income Ratio, Dmp, Money, Saving Money, Savings, Worry

Meet the author

author avatar Phyl Campbell
I am "Author, Mother, Dreamer." I am also teacher, friend, Dr. Pepper addict, night-owl. Visit my website -- -- or the "Phyl Campbell Author Page" on Facebook.

Share this page

moderator Mark Gordon Brown moderated this page.
If you have any complaints about this content, please let us know


author avatar Connie McKinney
2nd Aug 2013 (#)

Wow, what an inspiring story, Phyl. Thanks for sharing your tips. This story will help a lot of people climb out of debt - including me.

Reply to this comment

author avatar BubbaGump
2nd Aug 2013 (#)

always have a plan to not use so much credit and work for ur spending. Save is the most important

Reply to this comment

author avatar Mark Gordon Brown
2nd Aug 2013 (#)

Debt is horrible thing, people need to be smart about their money, and try to be frugal.

Reply to this comment

author avatar Sivaramakrishnan A
2nd Aug 2013 (#)

Thanks for an interesting and educational post, Phyl. I have taken care not to have debts that can only disturb our peace of mind. Banks hardly pay interest of 1% but have no qualms in charging 24% on overdue credit card dues. And they aggressively market credit cards even to the most vulnerable. Caveat emptor it is for the buyer! siva

Reply to this comment

author avatar Phyl Campbell
2nd Aug 2013 (#)

Thanks, Connie! To BillGate32 and MGB, yes, to be frugal is a good plan, but sometimes the attempt to be frugal can end up costing more. In hindsight, our vision is perfect.
Dear Siva, I hope you can continue in your way for peace of mind. It is a wonderful thing!

Reply to this comment

author avatar Delicia Powers
3rd Aug 2013 (#)

Phyl, thank you, a very helpful and real article- well done my friend...

Reply to this comment

author avatar Phyl Campbell
4th Aug 2013 (#)

Thanks, Delicia! Yep. Absolutely as real as it gets for me. ;)

Reply to this comment

author avatar Rose*
23rd Nov 2013 (#)

How does it work? Do they freeze the interest to prevent the debt escalating?

Reply to this comment

author avatar Phyl Campbell
24th Nov 2013 (#)

In Credit Counseling, the counselor or agency contacts the credit card companies on your behalf, and in our case, reduced interest rates above 30% to rates from 0% to 15%. We the clients had to agree not to use the credit cards and not to open any new accounts while on the program. Then we were given a payoff schedule, which includes a SMALL fee to the agency. One payment each month to the agency then allowed the agency to make payments to each creditor on our behalf. When we could afford to make extra payments, we paid them to the agency, and told the agency how we wanted them applied. In our case, we paid off the 15% APR card first, then worked our way down.
If you have other questions about credit counseling, please ask me. And if you need help, I hope you can find a counselor in your area. It isn't for everyone, but it was for us even though I was convinced it wouldn't be. And good luck!!

Reply to this comment

Add a comment
Can't login?