Top 10 Things To Be Successful On a Debt Management Plan

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Top 10 Things To Be Successful On a Debt Management Plan

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The goal of a Debt Management Plan (DMP) is to help get you out of debt by working with your creditors, and then to keep you out of debt. For many, they see joining a DMP as a fresh start financially, and taking a more proactive approach to correct their past mistakes. CareOne works to distribute your payment to the creditors, keep you updated on the status of proposals, and provide financial education and budgeting tools. The rest has to come from you. Below is a list of the top ten things you can do to be more successful on your DMP. 

  1. Don't wait too long to get help.  It is important to make a choice when you still have options. If you wait too long, you may be forced into settlement or worse yet, bankruptcy. If you are behind or think you are about to fall behind, start considering your options.  
  2. Pick the right payment date.  Too often I hear people ask how far they can push their payment out from when they enroll. If you are behind and the creditors are calling, the quickest way to make it stop is to make a payment. Look at your calendar and write down when your big payments like your mortgage/rent and car payments are due. Make sure you pick a payment date that doesn't coincide with these. If you find that is difficult, contact the lenders and see if they are willing to move the date. It is important to make your payment every thirty days so carefully pick a day.  
  3. Put all of your accounts on the plan. This can be difficult for some people because they have become accustomed to using plastic and they may still be living beyond their means. Most creditors require that all of your credit card accounts are on the plan;  people who put all of their accounts on the plan tend to me more successful because they don't have the temptation to use credit cards as a crutch. 
  4. Keep your accounts current.  The accounts do not have to be current for creditors to issue benefits but if they are current, the first three months tend to be easier to get through if you keep them current. If the account goes delinquent, most creditors will add late fees or over the limit fees to the account balance. Although most creditors will update your account status to current after 3 consecutive payments, some people have a hard time seeing the balances go up after they joined a plan.  
  5. Contact your creditors.  Your creditors want to hear from you. The account is in your name and you have a relationship with them. Write down what you want to say before you call and go from there. 
  • If you are behind:  "Hi, this is John Doe, I wanted to call and thank you for being patient while I get my finances in order. I wanted to let you know that I have enrolled in a credit counseling plan with CareOne and am committed to paying off this debt. You can expect to receive my first payment on MM/DD and if you have any questions, please contact CareOne at 888-888-CARE. Thank you!"
  • If you are current: "Hi, this is John Doe, I wanted to call and let you know that I have enrolled in a credit counseling plan with CareOne. Can you please move my due date to the 28th of the month? You can expect to receive my first payment on MM/DD and if you have any questions, please contact CareOne at 888-888-CARE. Thank you!" 
  1. Keep your payment date consistent.  We understand that your budget is tight and unexpected expenses do come up. Because of this, we have built some flexibility into scheduling your payment date. It is better to keep it the same each month because creditors like consistency. If something comes up and you think you may have to move it, exhaust other options first, and then move the date if you have to.  
  2. Read your mail! Both creditors and CareOne will be sending you mail and emails, especially in the first three months. Open it and read it! It's your plan, be a participant. Create a filing system for your credit card statements so you can track the balances and set goals to pay them off sooner.  
  3. Participate in the community.  Sometimes talking to people who have been where you are helps. Having debt can be a big burden to carry; don't try to do it on your own. Every day customers are posting about their experiences and successes which is great motivation. As you move along in your Plan, you will be able to help people that are just beginning theirs.
  4. Make your payments.  Joining the plan is only one small step towards paying off the debt. The larger, and more important step, is making your payments each month. Making your payments is a signal to the creditors that you are serious about paying off this debt and are committed to the Plan. The quickest way to improve your situation is to pay down your balances. 
  5. Look at how you got in this situation so you don't repeat it!  Customers who are successful on the Plan realize they have to make spending changes. If you do not have the cash to cover it, you don't buy it. Budget is not a bad word! Change it to "smart money management" if you think that sounds better. Get in touch with your money and understand where it goes.   Use all the free tools that CareOne offers on their website.  Read posts in the community and blogs and see how other people have managed to beat their debt!

 

Download a Free Resource Guide; 10 Things to be Successful on a Debt Management Plan  


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  • This blog was very helpful!  One question...What's step #3?

  • marcg:

    Thanks for catching the error.  #3 has been added.

  • that is helpful.  thanks  

  • why we are using credit just use debit card. Who could you know that you have money in future for pay your credit. Be a respectful man not a borrower.

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