Debt management programs are used for people who have too many bills to pay. In other words, their income is too low to cover all of their monthly expenses and bills. In a debt management program, you make a monthly payment to a company who then works with your creditors to get reduced payments and reduced interest rates. Debt Management Programs are EXTREMELY DANGEROUS and should be approached with great caution. Before agreeing to participate in one of these programs, you need to know:
- How your payments are determined and how much they will be
- How the program will work
- How it will affect your credit rating
- Which of your creditors can they GUARANTEE you will participate in your program
- What happens if one of your creditors refuses to participate
- When the company will begin making payments to your creditors and what happens to your accounts and your credit between now and then.
Debt Management Programs can Destroy Your Credit
The only real way to keep a debt management program from hurting your credit is to continue making your regular monthly payments to your creditors while the debt management company tries to set up your plan. Can you afford to pay both your creditors and the debt management company until you have proof your creditors have accepted your plan? If you can't make both payments, you need to make sure you fully understand the program. In addition, you need to understand that while the company is trying to set up your plan, your creditors are reporting you as late, adding late fees to your account, and perhaps increasing your interest rate. If you stop making payments to your creditors and only pay the debt management company your credit score will suffer.
Birmingham and Tuscaloosa Bankruptcy Lawyers | Free Consultations
Before you enroll in a debt management plan you owe it to yourself to talk to our Birmingham and Tuscaloosa bankruptcy lawyers. You may elect not to file a bankruptcy case, but you will be amazed at what you learn in your meeting. Our Birmingham and Tuscaloosa bankruptcy lawyers do not charge you to review your case. They will take the time necessary to become informed about your goals and your payment abilities. Debt management may be the answer for you, but make sure you know all the facts about all of your options before you sign on the dotted line.
Your Birmingham and Tuscaloosa bankruptcy lawyers can explain all of your options to you. You will not be pressured to hire us, or file a bankruptcy case. Your Birmingham and Tuscaloosa bankruptcy lawyers will explain your options to you for free.
How to Get Help and Get Out of Debt
When you are ready to get out from under your crushing debt, give Melinda Dionne a call. When you call, tell our assistant, Ginny, that you are a website reader and she will set you up with a free, no obligation, consultation to see how Melinda can help you start living again.