How Can You Make A Debt Management Program Work For You?

Majority of debt management programs (DMPs) were devised in accordance with the new bankruptcy regulations in 2005. From that time, numerous debt management programs have gone bust as a result of bad management and deceptive practices. For selecting a debt management program and making it work for you, you can go by the following steps and take advantage of them.

Step 1. Select a well-known and trustworthy debt management program. Verify with the State Attorney General’s Office of Consumer Affairs and the Better Business Bureau (BBB) for information about the debt management company.

Step 2. Work in close coordination with the financial counselor to formulate a practical budget and set objectives that can be accomplished. You should only work with your funds and income without forecasting tax refunds, windfall gains and so on.

Step 3. Request for an elaborate and written contract that includes all the details, assurances, commitments and a list of debts and creditors. You must turn down any contract that contains verbal promises. You should always have it on paper.

Step 4. Communicate with all your creditors to ensure that every creditor approves the debt management program. Remember that no creditor is bound to agree to a proposed debt management plan and might decline or a give you a counter-offer.

Step 5. Keep contact with your creditors to guarantee that payments are sent on time and the account stays current. You must remember that in spite of a debt management program, your personal liability towards the creditors remains the same.

Step 6. Check out modified interest rates with creditors and ensure that over the limit fees and late fees have ceased. Evaluate the monthly statements cautiously. Talk to the creditor initially and then talk to your financial counselor if you have any queries.

Step 7) You must have a steadfast commitment towards making regular payments for the debt management program. You can make arrangements for an automatic debit facility from your checking account to ensure regularity. Handle your personal finances carefully and follow the budget formulated by the financial counselor.

Contributed by Debt Community Member.