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Debt management Program faqs

A Debt Management Plan, or Debt Management Program, is usually administered by a Credit Counseling company. If you have fallen behind financially, and have amassed a large amount of unsecured debt, we help you get your financial life in order.

In an initial free credit counseling session, you collect all of your outstanding credit card statements, and monthly bills, and we work with you to create a manageable budget .
Next we assess your credit card debts, and other unsecured debts, and create a proposal to send to your creditors. Creditors have been known to lower your monthly interest rates, accept a lower monthly payment, or re-age your accounts so they are current, instead of in arrears. The goal of a debt management plan is to get you out of debt in the shortest period of time, without going through bankruptcy or debt settlement, both of which are detrimental to your credit score.

Once a proposal is accepted, we set up an account for you, where you transfer funds directly to us via EFT, electronic funds transfer from your checking account. Each month, we make sure your bills are paid on time, and keep you appraised of your status with a monthly statement of your account.

As an alternative to bankruptcy, or debt settlement, DMPs work to get you out of debt in the fasted time possible, while still taking into consideration your living expenses and needs. We support you along the way, and help you achieve freedom from debt.

Debt Management Programs work as long as you are committed to achieving your own goal of financial freedom. Without your total commitment to achieving this goal, no program or plan is going to work. Similar to attempting weight loss, any diet or exercise program will work, if you are committed to it, and stick to the program. No program will work if you are not committed to achieving your goal. We make it easy for you by being there, accessible by phone if you run into difficulties, and by making sure your payments are all made on time. We handle the details so you can focus on your life.

Debt Consolidation usually entails taking a loan to pay off your debts. In most cases, if unsecured debts are causing you stress, and bill collectors are calling you, your credit score is already low. With a low credit score, you cannot get a loan at a reasonable interest rate. We do not recommend taking out a loan to pay off bills. A Debt Management Program is a sort of Debt Consolidation Plan without taking out a loan. By enrolling in a Debt Management Plan you are able to send in one monthly payment, usually lower than the combined current payments to your creditors. We make sure they are paid, and on time. You are essentially consolidating your debt without a loan.

There are many debt management services available. The best are usually in business for a long time, are non-profit companies dedicated to serving you, and most are members of a national accreditation association like NFCC.
Check and be sure that all credit counselors working for the company are accredited.

ACCC has been in business as a credit counseling agency for over 25 years, all counselors are accredited, and we are members of NFCC.

Can I keep some of my credit card accounts open during a debt management program?
In most cases, you are supposed to stop using all of your credit cards. In some cases, you are allowed to keep one card “out of the program” for emergencies.

Education is necessary in order to avoid going into debt needlessly again. Many, many of our clients got into debt through no fault of their own, through medical circumstances, job change or loss, or any other of a myriad of causes. The education segment of the program is to help you make good choices in addressing your financial situation, and to help ensure that you achieve your goal of becoming debt free.

A Debt Management program is for individuals who need help in getting out from under a pile of unsecured debt without going bankrupt, and suffering the long lasting penalties to their credit score. The credit score is how banks and loan institutions determine your credit-worthiness and how much they need to charge you for interest on your loan. With a low credit score, you may not be able to get a loan or not a loan with low, affordable interest.

In some cases, a low credit score can prevent you from securing a job, or even an apartment. The score is accessible to anyone who really needs to know how creditworthy you are to landlords, bankers, car salesmen, etc.

A Debt Management Program may help you by letting you know exactly how much you need to pay each month, without going through the drudgery of each account individually. You can choose your payment date, and there will only be one payment date per month. This helps you plan your monthly expenditures. Also, in most cases, the monthly amount will be less than you would be sending in as individual payments, as in most cases, the credit card companies will lower your interest rate when they know you are enrolling in a DMP.

Bankruptcy should nearly always be considered as a last resort. The adverse effects of a bankruptcy on your credit score are long lasting. And the emotional effect of having declared bankruptcy can be devastating. Bankruptcy currently stays on your record for up to 10 years. Generally, a bankruptcy on your credit report will preclude you from consideration for some loans, and when you do qualify for a loan, the interest rate is usually much higher.

Initially, there is a notation that you have enrolled in a DMP. Some banks will see this as a negative; others may see this as a positive that you are actively trying to pay off your debts, rather than trying to “dump” them through bankruptcy or debt settlement.

Who would you rather lend money to, someone who has enrolled in a program that helps them pay off the full amount you lent them or someone who takes the “easy” way out and declares bankruptcy? Bankruptcy should be a final resort. Currently, bankruptcy candidates have to go through a credit counseling and debtor education program to be eligible for bankruptcy. The rules and stipulations for bankruptcy have changed dramatically over the past few years, and many individuals who may have been considered eligible for bankruptcy are no longer eligible.

Yes. There is an education component to the program, but it is very helpful to your situation, and fairly easy to complete satisfactorily. You will learn many things that you need to know about credit, money and finance.

ACCC does not charge a fee for budget counseling. There is a one-time fee of $39 for enrollment into the debt management program. The enrollment fee may be waived or reduced depending on your state's regulations or financial hardship. There is also a monthly maintenance fee of $5 per account with a minimum of $5 and a maximum of $35. The monthly maintenance fee may be waived or reduced depending on your state's regulations or financial hardship. As a non-profit agency, the fees help to defray the cost of providing services to the many enrolled individuals. ACCC prides itself in having the lowest effective fee structure in the industry.


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American Consumer Credit Counseling (ACCC) provides nonprofit credit counseling and debt reduction services for consumers with credit problems who want to know how to pay off credit cards and how to get out of debt. Our certified credit counselors have helped thousands of individuals and families nationwide pay off credit card balances and unsecured debt through credit card relief programs and credit card debt solutions. Our debt management plans provide a kind of personal debt consolidation strategy for help getting out of credit card debt, and we offer a wide variety of financial education services to consumers who need help getting out of debt and managing their finances more effectively.

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