Helping Stressed Consumers Deal With Credit, Foreclosure Issues

Helping Stressed Consumers Deal With Credit, Foreclosure Issues

Debt counseling service Auriton Solutions benefits from independence, federal program.

Roseville-based Auriton Solutions is now the largest credit-counseling agency in the Upper Midwest. And in this economy, it’s getting larger.

“We’re smack in the middle of a foreclosure war right now,” says Dick Fisher, Auriton’s director of counseling. “The big three [reasons why]? A job loss, a reduction in hours, or an adjustable rate mortgage.”

Auriton’s 60 credit counselors—more are being hired—take nearly 14,000 calls a month from clients worried about losing their homes and paying their bills. Many are referred to the company through the Home-owner’s HOPE Hotline, sponsored by the Homeownership Preservation Foundation, whose funding partners include Fannie Mae, HUD, and the National Foreclosure Mitigation Counseling Program. Auriton is one of eight nonprofit agencies that troubled homeowners are routed to when calling the HOPE phone line.

Auriton was founded in 1991 by Tiff Worley, a former epidemiologist who worked for 3M and Bioplasty Medical before becoming president of a Minnesota firm called Felas Lasers. It was while “winding down” the business at Felas that Worley began to examine the credit-counseling industry. Worley even put himself forward as a client to the established local debt management companies operating at that time and says he was “unimpressed with either of them.”

“You need to be an active listener to get to the root of the problem,” Fisher says. “Every time the phone rings, it is going to be a completely different situation.”

Auriton receives 40 percent of its funding from money set aside by banks and credit companies for the purpose of credit management and counseling, and 30 percent from other contributors including other nonprofits, foundations, and government. Auriton counselors come up with a specific debt management plan to present to creditors. Auriton’s average client has $12,000 to $20,000 in unsecured debt, but he or she often isn’t willing to admit the full extent of the financial troubles on the first call.

“With Auriton, 99.5 percent of our proposals are accepted by the creditor,” Fisher asserts. “We bring that debt back to current status, promise the [restructured] debt will be paid within 60 months, and all the principal will be paid back.”

Worley hopes that through education, counseling, debt restructuring, and “lifestyle changes,” more people will be able to get a handle on their debt. What’s more, “financial institutions and the government are starting to realize that troubled consumers need help if they are to be productive for themselves and the overall economy,” he says.

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