Debt Management Plan - Pennsylvania
If your credit card debts have spiraled out of control - so much that you are now struggling to keep up with your monthly payments - you may be interested in how much a debt management plan (DMP) could potentially save you. Debt management allows many consumers in Pennsylvania and across the country to find relief from their high-interest credit card debts, as well as unsecured debts (like medical bills, utilities, student loans, department store charges), with a more structured and more manageable payment plan.
The goal is with a more structured and more affordable repayment plan, you can hopefully, direct more of your payment into paying the principal of your debts versus just the interest. In addition, debt management has become a popular alternative to bankruptcy, which has a more damaging and longer lasting impact to your personal credit.
Find out if you qualify for savings with a free debt relief analysis and savings estimate by answering just a few, simple questions. Start here.
What to Expect with Debt Management
For many consumers, rising credit card and other unsecure debts are serious problems that won't just magically go away. If you are also in financial distress, you know that it often causes emotional and mental stress, and may even cause unwanted tension within families.
As mentioned earlier, one of the ways that you can find debt relief is through a process known as debt management, or debt consolidation. The goal of a debt management plan, or DMP, is to "consolidate," or combine, your unsecured debts into a single, more manageable and more structured monthly payment made to a credit counseling agency.
Facilitated by credit counselors, the debt management plan usually begins with a review of your income, financial obligations, and other assets. This process generally entails taking stock of your sources of income, debt amounts, and other expenses, as well as adding up the balances on your credit cards and the rates that you are currently paying.
Once credit counselors have a clear picture of your finances, they typically submit proposals to creditors, on your behalf, requesting lower interest rates and the waiving of late fees and penalties. Creditors that accept the proposals are added to the debt management plan. Credit counseling agencies, in turn, distribute those funds to creditors that are in the plan.
How Much Can I Save with a Debt Management Plan?
For many consumers who have the discipline to watch their budget and have stopped relying on their credit cards so much, a debt management plan can likely help them get on a path towards reducing their debts and getting some savings. Keep in mind, however, that while it is the credit counselor's responsibility to request from your creditors a more lenient repayment plan, it is your responsibility to ensure that you have the funds available in the account set up by the credit counseling agency.
In addition, make sure that you understand how much savings you can potentially get, every month, with a debt management plan. Typically, your savings depend on several factors: the total amount of your debts, the current interest rates, and any late fees or penalties.
The bottom line is, if you are ready to tackle your credit card and unsecured debts, it is a smart move to find out how debt consolidation with a debt management plan can help you achieve that goal.
To explore your debt relief options, request free debt relief analysis and savings estimate - at no obligation to you.