Debt Management Plans – Debt Consolidation Programs
A debt management plan(DMP) is a repayment arrangement, put together with the guidance of a Certified Credit Counseling, between you and your creditors. The goal of debt management programs is to combine your debts into one affordable lowest interest payment. This plan is approved by your creditors and administered by our agency. Participation on a debt management plan allows you to receive benefits from your creditors allowing you to have interest rates and monthly payment reduced. Additionally, if past due, creditors will bring delinquent payments to a current status and suspend late and over the limit fees.
Each month you will send your payment to our office on or before your assigned DMP due date. Your payment is then split between your creditors, according to their approved payment arrangement, and remitted to them promptly. You will continue making payments on your debt management program until all your debts are eliminated. Also, remember that you can always sent additional funds and pay off your debts sooner than your scheduled repayment term.
Before enrollment on a debt management program clients will undergo a credit counseling session which includes a review of a credit report and creation of a monthly budget. Program benefits including new interest rates and monthly payment will be reviewed before you decide to enroll. The length of your debt management plan will also be provided. You will not be pressured into enrolling on a debt management program and your participation is completely voluntary. You and your certified credit counselor will determine whether a debt management program is right for you.
Reputable credit counseling organizations can advise you on managing your money and debts, help you develop a budget, and offer free educational materials and workshops. Counselors are certified and trained in consumer credit, money and debt management, and budgeting. An initial counseling session typically lasts an hour, with subsequent sessions undertaken to further evaluate the most prudent course of action. A certified credit counselor will also review your credit report and help you understand your score and ways to improve and or maintain your credit. Regulations on credit counseling and credit counseling agencies varies state by state.
Debt Management Programs – Debt Consolidation Programs FAQ's:
How long does a debt management program last?
The average debt management program lasts for approximately 50 months. Program duration cannot exceed 60 month as per state law. Keep in mind the length of time you may be paying on your own may be in excess of 180 months or more.(if making the minimum payment only).
Can I keep using my accounts?
No. Remember why you came to us for help: your objective is to reduce and eliminate your existing debts, not add to them. As long as you receive benefits from your creditors (lower payments and lower interest rates), most creditors will ask that you stop using your accounts while on our program.
Can I choose my due date?
Yes. This is one of the most convenient features of our program. Your creditors may not be aware of your pay dates, or when your rent or mortgage payments are due. We want you to be comfortable with your payment date, so you can choose a date that doesn't conflict with your other obligations.
Will I get monthly statements?
Yes. If you currently receive monthly statements from your creditors, you will continue to get them. This will give you the opportunity to monitor the progress of your accounts while on the debt management program.
Can you stop creditor harassment?
Yes. If you are being harassed by your creditor once you enroll on our debt management plan, you can simply refer any calls from your creditors to us. We pledge to end creditor harassment.
Do I have to qualify?
The debt management program is not for everyone. A certified credit counselor will review your particular situation and make a recommendation whether or not you are a good candidate for enrollment.
Can I pay electronically?
Yes. If at anytime during your program, you would like to have your monthly payment automatically deducted from your account, please ask for an application for electronic debits.
How do i get started?
Simply call our office or complete a brief online form and a Certified Credit Counselor will contact you during normal business the same day you submit your application.
Can I add more accounts?
Yes. Simply contact our customer service department and give them the account information for the additional account(s). Or send your information by e-mail, and a representative will call to confirm the receipt of your information. What if I can send more money some months?We encourage you to send additional funds whenever they are available. Even a small reduction in principal now can save you hundreds in finance charges later. If you have a preference as to which creditor(s) should receive the additional funds, simply accompany your payment with a letter instructing us how to disburse the extra funds. Otherwise, we will apply any additional funds where they will do the most good based on account balance and interest rate. Any additional payments should be made through our office to assure you continue to receive program benefits.
Do you offer education?
Yes, we offer educational materials which cover a variety of money management and budget planning topics. We also offer two different financial literacy courses (Credit when Credit is Due & Money in Motion). Both are designed to enhance your financial knowledge by providing the fundamentals of money management.
Can I withdraw from the program later?
Yes. Participation is completely voluntary, and you can withdraw from our program at any time. However, keep in mind that if you decide to handle your debts on your own, all the program benefits offered by the creditors will stop.
To learn more about our credit counselor services contact our office today at 1-800-498-0766 ext 190 and speak with a certified credit counselor or complete our online form and request to be contacted.