Debt Management can be confusing, here are some of our frequently asked questions and video below describing the details and process of qualifying and enrolling in a debt management plan (DMP).
What is a Debt Management plan?
A Debt Management Program is a plan to eliminate debt quickly and dramatically reduce the amount of interest paid. A credit counselor will go over your finances and help create a customized budget that fits your needs. A counselor will negotiate on your behalf to lock in lower interest rates for your debts.
Enrolling a debt management plan will reduce your interest rates, eliminate late and over the limit fees, an lower your overall monthly payments. A DMP will consolidate all debts to create one low monthly payment. That payment is distributed among your creditors to pay off your accounts as quickly as possible. Your DMP will disclose the estimated monthly payment, estimated time to pay off your debt as well as an estimated savings over the course of your plan. On average, most clients repay their debts off in 5 years or less.
Enrolling a debt management plan will reduce your interest rates, eliminate late and over the limit fees, an lower your overall monthly payments. A DMP will consolidate all debts to create one low monthly payment. That payment is distributed among your creditors to pay off your accounts as quickly as possible. Your DMP will disclose the estimated monthly payment, estimated time to pay off your debt as well as an estimated savings over the course of your plan. On average, most clients repay their debts off in 5 years or less.
What kind of debt can I enroll?
A debt management plan can only enroll the following types of unsecure debts:
- credit card debt
- medical bills
- personal loans
What are the fees in a DMP?
The initial financial consultation with a credit counselor is free. You will be advised of the fees in your consultation, these fees include a one time set up fee, and a small modest monthly fee that is included in your monthly payment. The monthly fee is regulated by each state.
Do I continue to pay my creditors while waiting for verification
Yes, Before your account is verified, you will be responsible for maintaining payments individually, until your account is active
How long will this program take to pay off my debt
This varies from person to person. Depending on the amount of debt, and what you are able to afford, the length of the program will vary with each person. Debt can be added on at a later time, which can extend the program. However, most clients who enroll in a debt management program typically pay off their debt in five years or less.
