Christopher Honenberger, Clear Point president/CEO, noted that decades ago, credit cards were issued by local merchants such as department stores, limiting the number of places the holder could use the card. Then, as plastic with logos such as Visa and MasterCard became common and accepted at thousands of merchants, people began using them in ways that weren't responsible.

Members were coming into credit unions because they were overextended on credit cards and couldn't make their loan payments. Other lenders experienced the same thing. So Richmond retail merchants, financial institutions and others decided to help by launching a nonprofit credit counseling organization.

A key, Honenberger said, was education, teaching people how to avoid getting in that financial trap.

"I'm a former banker," he explained. "My extensive experience with credit unions has given me an appreciation for the fact the credit union industry and credit counseling have a very similar mission, financial literacy education."

"About 15 or 20 years ago three things happened. First was the consolidation of unsecured credit. Second, people have tended away from face-to-face counseling. While we think that's still a very important and valuable part of our business, statistics show more and more people want counseling by telephone. About 60% of our business is telephone-based, 20% is face-to-face, and another 20% is Internet-based."

The third change involves funding of credit counseling, Honenberger continued. Historically, when a counseling firm worked out payments to several creditors, the firm would receive 15%t of the amount paid. Today, the average is 5% or less. That has forced the industry to seek efficiency by merging, growing and in the case of many nonprofits soliciting grants. That includes Consumer Credit Counseling of Richmond, which after a number of mergers became Clear Point in 2003.

"We have a wide range of relationships with credit unions around the country," Honenberger explained. "At Langley Federal Credit Union we actually have a counselor in the main office. When an individual comes in and indicates they're having difficulty making payments on multiple accounts, not just Langley, they can be directed to our office right down the hall."

Other credit unions have Clear Point literature on hand and can refer a member to counseling by phone or Internet. 

It's not surprising to hear that in 2008 and 2009, as the Great Recession took hold, Clear Point saw a dramatic increase in referrals. Then, after 2009, there was a substantial decline. Honenberger believes the credit card disclosure act did indeed provide consumers with certain protection, especially high risk consumers. Even so, the list of problems still includes job loss, medical expenses and student loans.

"Payday lenders are a huge red flag," added R. Kirk Adams, a counselor at $1.6 billion Langley FCU in Hampton, Va. "That's a sign of financial instability right there. Online payday lenders are a tough problem. They're like vampires. Once they get hold of a member's account numbers, basically the only solution is to shut the account down and force them to settle. Clear Point can help negotiate a settlement or repayment plan, much like they do with credit card companies."

Although economic pressures on members have eased off a bit, Adams said both he and the Clear Point counselor are busy. He used to be booked out a week or two weeks ahead. Now his schedule is filled a month in advance. He's like emergency room staff conducting triage to determine the most urgent problems.

"Education about the wise use of credit is lacking across the board," he stressed. "I sit down with single moms on disability and engineers. It doesn't matter the income or education. It's incredible how many people do not have any concept of what credit is, how to use it and how to manage money. Just knowing about credit and paying attention to money, you can solve most of the problems. I tell people, you can't spend your way to joy."

Angie Ellis, senior vice president of operations and consumer lending at $190 million Arsenal Credit Union in St. Louis, said the credit union spots members struggling financially by loan applications not approved, failure to pay creditors on time, and requests for funds to catch up on bills.

Ken Moser, vice president of marketing, added that when a member is turned down for a loan the staff has been trained to refer them to a Clear Point counselor for special assistance.

As far as Ellis is concerned, one of the toughest problems the credit union faces is counseling a member toward bankruptcy when that could lead to a loss for the credit union. Moser is concerned when members who could benefit from free, professional counseling don't take advantage of it.

Roger Ball at $350 million Call Federal Credit Union in Richmond said the nonprofit status of counseling firms such as Clear Point makes it easy and affordable for the general consumer to get advice. One lingering impact of the recession is that people are migrating back to credit counseling.

"The job market wasn't very secure, salaries and employment were being cut, and many people were neck-high in debt. There was probably a resurgence of awareness of credit counseling. The recession has made many people aware that they need to limit how much credit they're carrying, and Clear Point is providing them a way in three years to get back to a very livable budget," Ball said.