Don't Enroll In A Debt Management Program Unless You Know These Five Things

Jan 26
17:39

2021

Seth Lutnick

Seth Lutnick

  • Share this article on Facebook
  • Share this article on Twitter
  • Share this article on Linkedin

Faced with overwhelming debt? One popular way to potentially handle overwhelming debt is to enroll in a debt management program. Before you enroll, there are some things that you should know about how debt management programs operate.

mediaimage

What you need to know about debt management programs

A debt management program is a service that will combine all of your credit card debt into one payment plan. In order to enroll into a debt management program,Don't Enroll In A Debt Management Program Unless You Know These Five Things Articles you will pay the debt management company of the program a modest fee. Debt management programs are popular because they offer some benefits, including simplifying the debt payment process and possibly saving you money as well as grief.

You can read more here: Get Me Out of Debt - About Debt Management Programs

Here are the five things to know:

1). You might be able to handle this yourself

It may be possible to manage your debt issues yourself if you are willing to put in the work. If you don’t want to pay an extra fee, then simply contact all of your creditors and negotiate a payment plan yourself. In many cases, credit card companies and creditors will want to work with you.

 

2). You could see a dip in your credit score

If you enroll in a debt management program, you may experience a drop in your credit score. This could be problematic if you are looking to get a home loan or an auto loan in the near future. However, if you are dealing with credit card debt issues, it may be better to postpone attempting to take on more debt.

3). Say goodbye to new credit

During your time in the debt management program, you will not be able to go get any new credit. This could be a big benefit since you should not want to take on new debt while you are trying to deal with your current debt situation.

4). Your debt is paid by the management company

With a debt management plan, you no longer pay your creditors. Instead, your debt management company handles the payments to your creditors. For this service, you will pay the debt management company a modest fee.

5). Make sure you can save money with this program

Many debt management programs may try to sell you on the fact that they can save you money. However, when you factor in the fees from the debt management company, the total savings may not be there. Be sure to double check the numbers before signing on to any debt management program.

Should you enroll?

Overall, a debt management program may be your best idea if your are overwhelmed with debt. On the other hand, you may not want to consider a debt management program if you don’t want to pay the extra fee and you plan to apply for a home or an auto loan in the near future.

Get to know all the facts before you decide

Enrolling in a debt management plan can be a really smart way to handle your debt. However, you need to make sure that you know all the facts. Be sure to do your research before making your final enrollment decision on any debt management program.

Also From This Author

How to Create Backing Tracks If You Don't Play All the Instruments... or Any

How to Create Backing Tracks If You Don't Play All the Instruments... or Any

Congratulations! Your singing has become amazing, and it's time the world knew. You've also written some songs that are just kick you-know-what. They need to be recorded, MP3ed and put on the net ASAP. But you've got two problems. First, you can't afford a studio, let alone a band for all this stuff. Second, you don't play all, or any, of the instruments.
Mastering the Art of Travel and Scenic Photography

Mastering the Art of Travel and Scenic Photography

Capturing the essence of a breathtaking landscape or the vibrant energy of a bustling street scene is an art form that many travelers aspire to perfect. Travel and scenic photography is not just about snapping shots of beautiful vistas; it's about conveying the emotion and atmosphere of a place. With the right techniques and equipment, you can transform your travel experiences into a stunning visual diary. This article delves into the essentials of travel photography, offering tips and insights to help you take your scenic snapshots from ordinary to extraordinary.
The Dilemma of Home Music Recording: A Double-Edged Sword

The Dilemma of Home Music Recording: A Double-Edged Sword

In the digital age, the allure of home music recording is undeniable. With the advent of sophisticated software and affordable equipment, the process of capturing and manipulating sound waves has become an accessible art form for many. This democratization of music production has sparked a creative revolution, allowing songwriters to immortalize their melodies with a few clicks and drags. But is this ease of access always beneficial, or does it come with hidden costs to the quality and evolution of music?