Anyone in a Debt Management Program?

[marty56]

I just made my last payment to a debt management program.  It took over 4 years to complete.  It still have about 8000 debt left from other accounts that were not added to the program, but will be paid off by the end of March.

My current FICO scores are all over 700 now.  I am planing to get a new car this spring or summer and I am not sure how being in the program will affect the car loan.

I had a Citibank account that was 20  years old that was just closed because it was paid off.  My score droped 2 points after that.  I have an open gas card, SAMS club, and COMPUSA account all of which will have a 0 balance between now and the end of March.

I was not behind in my payments when I endtered the program and had only 2 30 day late payments on my report prior to entering the program.  Bank America screwed me while I was in the program and raised a payment withoput telling me so it wound up over 90 days late for several months until the sent me a letter about it which was 6 months after the fact.  That was over 2 years ago and nothing bad has happened since.

Anyone else here in a debt managment program or thinking about going that road?  Also any advice and what to do after 0 credit card debt would be nice.

Message Edited by marty56 on 11-19-2007 01:22 PM

[Anonymous]

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marty56 wrote:

I just made my last payment to a debt management program.  It took over 4 years to complete.  It still have about 8000 debt left from other accounts that were not added to the program, but will be paid off by the end of March.

My current FICO scores are all over 700 now.  I am planing to get a new car this spring or summer and I am not sure how being in the program will affect the car loan.

Congrats! That is a terrific achievement.

Tell the DMP people to get the creditors to remove from your credit reports any notation that you were enrolled in a DMP.  Or better, tell the creditors yourself.

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marty56 wrote:

I had a Citibank account that was 20  years old that was just closed because it was paid off.  My score droped 2 points after that.  I have an open gas card, SAMS club, and COMPUSA account all of which will have a 0 balance between now and the end of March.

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Be prepared for your score to possibly drop more.  You lost an account which affects your average length of credit history (unless all your accounts are 20 years old).

 

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marty56 wrote:

I was not behind in my payments when I endtered the program and had only 2 30 day late payments on my report prior to entering the program.  Bank America screwed me while I was in the program and raised a payment withoput telling me so it wound up over 90 days late for several months until the sent me a letter about it which was 6 months after the fact.  That was over 2 years ago and nothing bad has happened since.

I thought most programs wouldn't take you unless you were already seriously delinquent.  Two prior lates hardly puts you in that category.

Don't be so sure it was B of A that caused the trouble.  Weren't the DMP people supposed to be communicating with B of A and with you?

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marty56 wrote:

Also any advice and what to do after 0 credit card debt would be nice.

Stay out of debt!

[marty56]

Most people who entered the program were behind in their payments.  They accept people who are 10,000 or more in debt.  I had over 60,000 in debt and the program forced me to develop and stay on a budget.  I was also finally able to see that my spending was out of control.

Geting into that much debt cost me more then just the money and I will never be in that situation again.  I will never carry a balance on a credit card again.

I have an Excel spread sheet that plans my budget for the whole year and I dont think I could have made it without having one.  I will continue to use it for the rest of my life.  They funny thing is once I started doing this, I seemed to have extra money.

As far as B of A goes, I contacted my debt managment company when I got the letter from B of A and I was suprised when they told me it that they dont get contacted by the credit card companies if there is a change on the terms.  I will contact B of A when it get my last statment from them next month and see if they will remove the late payments from my credit report.  I dont expect them to do so but it is worth a try.

It would be easy to blame credit card companies for my situation but I know the only person to blame is me.  It is interesting that most of the major credit card companies have information on their web site about using credit wisely.  Kinda reminds me of Philip Morris and their smoking education adds.

The only wise use of credit cards is to pay the balance each month or not use them at all. 

[Anonymous]

Congrats again on turning your life around!