Charles Hixon

A nonprofit credit counseling agency is seeing a huge increase in consumers needing financial counseling because of the recession.

“If you’re using one credit card to pay another, you need to do something right away,” said Charles Hixon, director of the Consumer Credit Counseling Service of the Partnership for Families, Children and Adults in Chattanooga. “Come see us, or see someone else.”

The agency is placing more than 70 clients a month into debt management plans, he said, a recent increase of about 20 percent from 50 clients a month. Many of those clients have used their credit cards as an extension of their income and got into trouble, Mr. Hixon said. Some were even using one credit card to pay off another credit card.

The group helps people solve their financial problems, and is affiliated with five United Way agencies, according to its Web site. The organization works with people in Southeast Tennessee, North Georgia and Northeast Alabama, Mr. Hixon said.

Even more people are seeking advice on housing, he said, and foreclosures have accounted for a large number of the increase in clients. Until March, the counseling service was advising two or three people a month on foreclosures, he said, but now is advising 30 or more a month.

Most of the people facing foreclosure bought a home at a low, adjustable rate, Mr. Hixon said, but that rate increased and the home owner could not keep up with the payment.

One real estate agent who specializes in foreclosures said her business has increased, but that the real estate market could be facing a turnaround.

“I’m getting more of the $10,000 homes, the rundown homes,” said Cindy Walker, director of Crye-Leike Realtors’ foreclosure division. “I’m still getting some nice homes, but mostly bad. In the past, that’s been an indicator of a turnaround.”

Mr. Hixon said some of his foreclosure counseling clients also are facing the loss of their house because of unemployment.

In addition to foreclosure counseling, the Consumer Credit Counseling Service is seeing more senior homeowners seek advice on reverse mortgages, Mr. Hixon said. Such loans eliminate a senior’s mortgage payments and provides the owner with the home’s equity.