debt management programs

[Anonymous]

hi,could you please tell me who you used. I signed up with credit solutions and am getting nervous about it

[Anonymous]

hi

are they really good.  read your comment and you sound positive

I need help and am very nervous about it. Do you have any advise

[Anonymous]

Sorry about my delayed respose - I paid a $50 donation that was calculated into my monthly payement.

[uktaurusbulba]

Tuscani, I have seen you recommend NFCC as a good debt management service but you also said this could be done on your own? Now, the reason I would do it is so I can get lower rates and thus have more monthly cash flow. Ive tried to negotiate with all myself and Ive gotten somewhere but two cards that have the majority of money owed are in the upper 20s for interest rates. If the credit cards wont do it for me, why would they for them? Am I saying the right things? Like should I ask to do a dmp to a credit card? Any help is appreciated. Thanks and Happy Holiday, Robert

[fishbjc]

My dmp reduced my interest to 4% on BofA Cc and 13% on my signature loan.  I pay $15 per month maintenance and donated $30 for the initial paperwork.

Since my DMP was recommended by BofA, the relationship was excellent.  I have it set up to pay a few $$$ extra each month and have brought my balances way down.  I intend to be out of the program in one year.

I paid off a couple of other cards on my own very quickly. 

I have had excellent results and mine report to the BBB.  I hit a snag and it was all rectified.  One thing I will recommend is:  talk to your counselor, not to whomever answers the phone if you have any issues.

PM me and I'll, as well, pass along this information to you.

[Anonymous]

I used ACCC (http://consumercredit.com) and they were good but if I had to do it all over again I would not go through a DMP. The reason being because I had to close all 4 of my credit cards. They did let me keep one open for emergencies. Another thing I did not like is they charge you a finance charge of $3 per account in the program and some banks put negative remarks in your credit report that say "managed by a DMP" which when a lender reviews it looks bad if you are trying to get a loan for a car or home. Chase was great, the two credit cards I had with them they lower the rates from the 20's to 6% and no negative comments. Us bank and citibank credit cards put the negative comments and had higher rates. The negative commends do go away once you paid the cards in full. My strategy was to pay the cards with the negative remarks first and then the other ones. If I had to do it again I would talk on the phone with the credit card companies and try to get the rates reduced. I didnt like having to pay ACCC $12 a month to manage these accounts for me.

[Anonymous]

Check the United way in your area.  They generally have low cost DM programs and you can bet that they are legit.

[Junejer]

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@Anonymous wrote:

Due to medical reasons,I might have to enter into a debt management program. I was told by the debt management company that my score would not be affected by entering into such a program. Any information would be appreciated.

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I am not speaking from personal experience, but from my Aunt's experience. She was on a DMP, because she co-signed a car loan for her son and he lost his job. When they came after her, she was advised by the atty to get with a DMP. Since she was going into the DMP, she threw in another small bill $1,000. Being on the DMP did an injustice to her FICOs for the time that she was in the program, keeping her scores in the 500s. As time has gone on her scores have increased. Here is the kicker. I was shopping around for a HELOC for her recently and she was denied by a HELOC provider, because she was in the DMP four years ago. Her middle scores were as follows 659 667 682. This is the first time that she has been denied because of the DMP to my knowledge. I hope that this is not a trend and maybe just due to the banks being a little gun shy right now.

[haulingthescoreup]

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@Junejer wrote:

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@Anonymous wrote:

Due to medical reasons,I might have to enter into a debt management program. I was told by the debt management company that my score would not be affected by entering into such a program. Any information would be appreciated.

---

I am not speaking from personal experience, but from my Aunt's experience. She was on a DMP, because she co-signed a car loan for her son and he lost his job. When they came after her, she was advised by the atty to get with a DMP. Since she was going into the DMP, she threw in another small bill $1,000. Being on the DMP did an injustice to her FICOs for the time that she was in the program, keeping her scores in the 500s. As time has gone on her scores have increased. Here is the kicker. I was shopping around for a HELOC for her recently and she was denied by a HELOC provider, because she was in the DMP four years ago. Her middle scores were as follows 659 667 682. This is the first time that she has been denied because of the DMP to my knowledge. I hope that this is not a trend and maybe just due to the banks being a little gun shy right now.

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An additional thing to think about --a worrisome number of DMP's make their payments late, so that you wind up accumulating more late payments on your credit history. There are good programs out there, but there are many, many bad ones.

If you're willing to read through these forums, post your reports and scores, and listen to the feedback here, you can probably do just as well for yourself. And along the way, you will gain understanding of how credit works, especially in your life, and save yourself some $$$ in the process.

[marty56]

I graduated from http://www.40debts.com/counseling/default.asp (Debt Free Christian)

There were great.  A few points:

1.  You need to monitor your CC balances and payments.  Be proactive.  Don't assume the people at the DMP will do anything more for you then make the payments.

2.  Twice in the 4.5 years I was in the program I had to pay  Discover since the payment was not paid when Discover wanted it.  The other CCC didnt care about that as long as it was paid around the due date

3.  Do not seek new credit (except a mortgage?) while you are in the DMP.  BofA dropped me from the program for a Sams card they didnt seem to care about the mortgage I got.  They added me again after several months of 60+ lates due to the fact the DMP was paying less then they now wanted.

4.  The DMP doesn't make payments to optimize your FICO score but if you have extra money, you can pay the CCC yourself.  Make sure if you are close to paying it off that you let the DMP know about the new balance.  After you pay it of course.

5,  I never had this problem but assume that a late payment or a NSF is fatal to the program.

6  I never did but you should monitor your FICO scores while you are in the program.  I didnt but I suspect that my scores didnt improve till 2 or 3 years into the program.

I do not know if CCC blacklist people who were on the DMP after the account is closed but I was able to get a pre-approval from National City Visa card after I graduated the DMP so there is life after the DMP.

A byproduct of being in the DMP was that I had to make a monthly budget which I still use today.  I cannot even begin to describe the feeling I had when I made my last payment to them.