Debt management programs are usually administered by a credit counseling company. If you have fallen behind financially and have amassed a large amount of unsecured debt, this can help you get your financial life in order. If your main financial goal is to eliminate credit card debt, it is important that you understand the ins and outs of a debt management program.
Do Debt Management Programs Work?
The success of a debt management program depends on how committed you are to achieving your own goal of financial freedom. Without your total commitment to achieving this goal, no program or plan is going to work.
How Can a Debt Management Program Help You?
- Reduce interest rates & stop late and over the limit fees
- Consolidate your unsecured debt into one easy monthly payment
- Pay off your debt in a shorter period
- Develop a workable budget that you can live with
What Questions Should I Ask Before Entering a Program?
Before you make any hasty decisions and decide to work with an agency, you should take the time to research the true cost of credit counseling. Here are some crucial points to look for when determining the best agency.
- What are the fees? Are there any set-up fees or monthly fees? Be sure to get a specific price quote from the counselor.
- Most agencies are subject to state law and can charge no more than the maximum allowed within your state. Make sure you ask the counselor the specific regulations for your state.
- If you are unable to afford the fees of the agency, the agency should be willing to waive the fees if you simply can’t afford them.
- Be sure the agency is charging you reasonable fees (not more than $50/month for a debt management plan), but this can vary by state.
- If the agency asks for a voluntary contribution, you may want to consider another agency. There is no such thing as a voluntary contribution.
- Does the agency charge for educational programs and ongoing education? Be sure the agency provides you with educational resources to help you learn how to manage your finances. The agency should also be able to provide you with ongoing counseling and education at no charge.
To learn more about debt management programs check out our website or talk with a certified counselor today at 1-800-769-3571.