How does the debt management plan affect my credit score? Your credit score is not directly affected by joining a debt management plan (see 4 credit-scoring myths). While some lenders may treat credit counseling unfavorably, the long-term effects of a debt management plan are beneficial. In fact, the debt management plan is designed to allow you to rebuild and restore your credit history by giving you an opportunity to:The interest rates that you could be eligible for depend on which creditors you owe, the amounts owed to each account and the type of account. Interest rates have ranged from no reduction to 0% interest. Once your creditors grant benefits, your lower interest rates are locked in for as long as you make consistent on-time payments. Your counselor can help you understand what interest rates to expect based on your consultation.Some lenders may view a credit counseling notation negatively.
What are the benefits of the debt management plan? Most creditors provide financially distressed clients the following direct benefits through the debt management plan: For consumers that are currently past due on their accounts the debt management plan will provide the immediate benefits of lower payments, late and over limit fee suspension and account re-ages. These benefits immediately provide our clients with a fresh start on paying their accounts and enable them to avoid collections, charged-off accounts and possible bankruptcy.CCCS works with thousands of creditors nationwide. We have established relationships with all the major credit card companies, most chain store credit departments and finance companies.
What fees do you charge in order to provide the debt management plan? All initial counseling, including budget and debt review, is free. If you were to qualify and choose to enroll on a debt management plan, the costs may vary based on your states regulations and the number of unsecured accounts you place on the program. Clients typically pay a nominal set-up cost ($34.90) to cover the expense of account activation, and a monthly servicing cost to cover recurring expenses. Clients under severe financial distress may have some of their costs waived.CCCS-OC will never turn anyone away who requests debt counseling. However, our Debt Management Plan may not be appropriate for every situation. The DMP is designed mostly for those that are behind on their accounts or who are only making the minimum payments on their cards.
If I go on your Debt Management Plan, will I ever be able to get credit again? Of course! Graduates of our program buy houses and cars everyday, not to mention being approved for credit cards. The creditors believe in our financial education, and support your efforts to honor your commitments to them. Naturally you'll need to have a steady income to be considered for credit, but that's no different from any consumer applying for a loan.The Debt Management Plan (DMP) is a debt repayment program that allows you to make one simple payment a month to CCCS-OC, who will distribute it to your creditors for you. The DMP serves the dual role of helping you repay your debts and helping creditors collect the money owed them. CCCS-OC's specially trained counselors will review your income, expenses, and bills and design a workable budget and repayment plan personalized to your special needs.The interest rates that you could be eligible for depend on which creditors you owe, the amounts owed to each account and the type of account.
How long will my accounts take to pay off on the debt management plan? The debt management plan is designed so that consumers can pay off their accounts within a 3 to 5 year period. Some clients begin the debt management plan during a time of severe distress due to an unforeseen hardship and therefore are only able to make minimum payments to start. As they begin to regain financial stability, however, many clients are able to send more than the minimum payments and therefore complete their debt management plans earlier than forecasted.A Debt Management plan is a debt solution for anyone who has unsecured debts that they can't afford to repay. A DMP requires you to have a surplus income each month (money left over after you have paid all of your living costs and household bills from your income) and owe money to more than one creditor.
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