Debt Management Programs

Debt management programs help you consolidate high-interest rate credit card bills and put and end to overwhelming monthly payments. It is a confidential program individually designed to provide you with a unique consolidation debt solution for your financial situation.

Debt management programs provide professional, certified counselors to assess your finances, create a debt repayment plan, and negotiate the terms of your debt consolidation with your creditors. By negotiating terms such as lower interest rates and waived late fees, debt management programs provide you with more affordable payments and shorter payoff periods.

Your debt management service sends a proposal letter to each of your creditors when you enter the Debt Management Plan after you have submitted all of the documents requested by your counselor. This letter advises each creditor that you have sought debt repayment assistance and provides them with a monthly payment schedule and estimated payoff date. The payments you make are directly deposited into your account and the debt management program disburses it directly to your creditors.

It takes approximately 36-60 months to repay debts through a debt management program. You should receive a written estimate of the length of time it will take to completely payoff your debts. This written estimate, or pay-out forecast, identifies all debts that are included in your management plan, the total estimated debt owed to each of your creditors, the proposed payment to each creditor, and the anticipated number of months necessary to eliminate debt through the debt management program.

After enrolled in a debt management program, you should make your monthly payment deposits on time. Auto-deposit provides the most timely, convenient and dependable method of payment by deducting your monthly deposit directly from your checking or savings account.

It is also important to monitor your creditors statements after enrolling into a debt management program, to ensure that creditors have reduced interest rates or stopped late fees, if applicable, and make sure your debt management program payments are being properly credited. Don’t make any payments directly to your creditors unless you have been instructed to do so by your debt management program counselor.

Non profit debt management programs charge a minimal fee for their outstanding debt consolidation services. Usually you can expect a one-time set up fee of $35 to $45. You also have the option of making contributions each month. Debt management programs are funded primarily from fair share contributions from creditors. Debt consolidation plans serve the dual role of helping you repay your debts and creditors to receive the money owed to them.