Hello!
Long time lurker who finally decided to make an account and contribute :smileyhappy. I wanted to share my story so far because i personally have not found many posts on this forum (or others) that talk about experiences with a debt management program.
In November 2014 after realizing i was no longer treading water i was starting to sink i started frantically searching for debt solutions online. I tried looking for reviews or posts on other peoples experiences and after days i came across a reference to American Consumer Credit Counseling http://www.consumercredit.com/ . I decided to call them ad see what they had to say, they were my starting point so i did not have high expectations. I called on a week night after work and the lady i spoke to said that there was a list of questions i would have to answer to determine whether the program would be right for me and that it would like 30-45 minutes.
She wasnt kidding, she asked a ton of questions about my financial situation as she was filing in a budget work sheet which she used to determine whether DM or bankruptcy would be right for me. Here is the section of my worksheet related to monthly expenses so you can see what information she wanted regarding my monthly household budget (please note the numbers here are after we discussed each expense and how we could lower it (e.g: my phone bill was originally $140 and i said i could remove a feature and save $15):
EXPENSES:
Household Expenses: Weekly Monthly
Auto (Gas & Maintenance) $23.09 $100.00
Auto Insurance $0.00 $0.00
Cable $28.87 $125.00
Child Daycare/Activities $0.00 $0.00
Child Support Payments $0.00 $0.00
Clothing $11.78 $51.00
Contributions $0.46 $2.00
Education Expense (class fees, school supplies) $9.24 $40.00
Entertainment $13.86 $60.00
Gifts $0.00 $0.00
Grocery Expense $46.19 $200.00
Home/Renters Insurance $0.00 $0.00
Household Items $11.55 $50.00
Laundry/Dry Cleaning $3.46 $15.00
Life Insurance $0.00 $0.00
Medical (Dr./Dentist & Prescriptions) $0.00 $0.00
Misc $0.00 $0.00
Misc 2 $0.00 $0.00
Misc 3 $0.00 $0.00
Personal Care $0.00 $0.00
Savings $1.15 $5.00
Telephone $28.87 $125.00
Utilities $18.48 $80.00
Total Household Expenses $197.00 $853.00
After determining my monthly expenses we then reviewed all my open credit/loans and after giving her how much i owed each, the APR and current minimum payments she told me how much they PROPOSED my minimum payments will be brought down to for each creditor(this is very important: just because they propose does not mean this is the actually final number!) Below is the proposal plan, please note these are not the original figures as some creditors back back and said they were too low they needed to be increased by a few dollars (think $5-$10, not a big number):
Unsecured Debt and Program Payment:
Unsecured Debt (proposed program payments):
Bank of America - VISA (RPS) $9.93 $43.00
Capital One (RPS) $3.46 $15.00
Capital One (RPS) $3.46 $15.00
Citibank - Mastercard (2) (RPS) $4.62 $20.00
Discover Card (RPS) $29.33 $127.00
GAP / Synchrony (RPS) $17.55 $76.00
Macy's - All Divisions / Citibank (RPS) $8.78 $38.00
OneMain Financial $25.87 $112.00
PayPal Buyer Credit / Synchrony (RPS) $15.94 $69.00
Target VISA (RPS) $19.63 $85.00
Wal-Mart Dual Card / Synchrony (RPS) $16.86 $73.00
Total Payment for Program Creditors $155.43 $673.00
ACCC Maintenance $8.08 $35.00
Total ACCC Program Payment $163.51 $708.00
Originally she said that the proposed payment plan should be $672 if proposal is accepted as is, but after negotiating with everyone during the enrollment process the payment is now $708 each month as you see above.And yes ACCC charges $35 a month. There is a one time enrollment fee of $35 as well so keep in mind your first payment will include an additional $35 (you can also have the one time fee billed on a separate date if your cash strapped which is what i did).
So to summarize everything nicely, here is the initial budget we devised:
BUDGET SUMMARY:
Employment Income: Weekly Monthly
Total Net Income $706.93 $3,061.00
Less: Household Expenses $197.00 $853.00
Less: Secured Debt $346.42 $1,500.00
Less: Non-Program Unsecured Debt $4.62 $20.00
Less: ACCC Program Payment $163.51 $708.00
Total Disposable Income / (Deficit) ($4.62) ($20.00)
Yes i realize there is a $20 deficit. She did advise me of it and told me i would need to find a way to reduce one or more of my
household debts to make up for it. I ended up changing my cable plan (it is now $117) and my phone plan (now $92) which erased that.
Here are the payment details for the program, you can either send them a check monthly or you can have them withdraw it from your acct, opted for the account withdrawal.
PROGRAM PAYMENT SUMMARY:
Month Scheduled to Begin Program: January 2014
Total Monthly Payment Due to ACCC $708.00
Date Payment Due to ACCC: 2nd of each month
Date Payment Disbursed to Creditors: 10th of each month
And here is what i would have been paying if i coninued paying just minimums
on my own vs enrolled:
Last Payment Date: 2/24/2037 vs 1/24/2018
Number Of Payments: 264 vs 35
Total Paid: $55,870.60 vs $24,049.01 (savings: $31,821.59)
Interest Paid: $33,196.39 vs$1,365.77 (savings: $31,830.62)
I have been enrolled in the program for a year now, so fa so good. The only hiccups i had were in the initial sign up period. As i mentioned i called them in November, i believe it was a week before thanksgiving. The first payment was withdrawn on December 2nd, ACCC had started the process of contacting the creditors and notifying them of my enrollment but they had not yet accepted any proposal. On December 10th ACCC made the minimum payments that are listed above on the proposal to each creditor. I was responsible to pay the balance that was owed if my minimum payment was actually a larger amount then what is listed above. In addition, in November when i signed up i was given a sheet which told me which creditors to call and close the accounts with, which ones to keep open and adjust the due dates on based on the disbursements. So any accounts that had a due date after 10th were not changed.
I forgot to mention, i was advised that i should close specific accounts (BOA should not be closed for example, they will close it for me. She did not explain why she said it was BOA's rules that the acct be open for enrollment)but ultimately all accounts enrolled will be closed. I have read some posts which state they are required to close all credit accts to join the DMP, this was not required of me as she told me to keep my overdraft protection open (it is also not included in above worksheet).
I have written a novel so i will stop now lol. If i think of anything i will add to it otherwise i doubt i will have an update any time soon. Of course if anyone has questions i will answer to the best of my ability. Again the purpose of my post is for anyone else who was searching for information and could not find it.
Addding this after writing this loong post: i copied some charts from ACCC but myfico did not like th html so it was removed. only text was left and i was too tired to do better.
