Hello All Member, What is a Debt Management Plan? I think that A Debt Management plan is systematic way to pay down your debt. A credit counseling agency will first do a comprehensive review of your current debt situation. Then the counselor will discuss numerous Alternatives for getting you back on track, including budget management and money management education. Please share your Opinion here ...
Even when you pay on time after having been on the program,Your credit score still tanks,all your cards will get closed.
From what I read it works like this: 1) sign up with DM company 2) send all your credit card bills to DM company 3) send your money to DM company (so they can pay your bills) DM company then 1) stops paying on your credit cards 2) keeps your money 3) calls your credit card companies after a couple of months to try and negotiate lower rates, payments, etc. 4) sends the lower payment while you keep sending your money to the DM company Yes they can lower your rate. Yes they can lower the overall balance due. But, they do it in a way that is just short of declaring bankruptcy without any of the protection from law suits that bankruptcy offers. IMO, you could do the same thing if: - you wanted to trash your credit rating for then next 5-7 years - don't mind risking a law suit - you want to keep some of your money IMO, the DM companies are taking advantage of the same, ill-informed people that the banks took advantage.
