Top Ten Things to be Successful on a Debt Settlement Plan

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Top Ten Things to be Successful on a Debt Settlement Plan

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In a previous blog we discussed the top ten things to be successful on a Debt Management Plan.

This blog focuses on the top ten things to be successful on a Debt Settlement Plan.

Both Debt Management Plans and Debt Settlement Plans have the same intent, which is to help our customers become debt free, which is why you may see similarities between the lists. However, there are many differences. Debt Settlement offers a lower monthly payment than a traditional DMP, however creditors do not receive regular payments as they do on a DMP which can lead to increased collection activity.

It is important to pick the right Plan to assist you in accomplishing your goals.  

10.  Pick the Right Payment Date.  It is important to pick the right payment date so you start off on the right foot. Take into consideration your mortgage and car loan payment dates, as well as any other payments you make on a regular basis. The payment should be entered in your budget and treated the same as your mortgage or rent. The payment needs to be made every month to put yourself in the best position to succeed.  

9.  Pick the Right Payment Amount.  CareOne's Debt Settlement Plan has a few options in regards to the estimated length of the Plan. Based on a customer's budget some Plans can be over in as little as three years, or sooner, depending on the creditor's acceptance. The more quickly your escrow account builds value, the faster the negotiators can start working towards settling your accounts. Don't just pick the five year plan because it has the lowest payment. Review your budget, identify expenses you can either reduce, or cut completely, and pick a higher monthly payment.

8.  Include all of your Debt.  Including all of your unsecured debt is the best way to tackle becoming debt free. Let's be honest, if you could have paid it off on your own, you would have by now. You were looking for help with your debt and you found it with CareOne so include all of your debt.  

7.  Monitor your Creditor Communications.  Creditors will continue to send communications. It is important to read them and let us know if the debt has changed hands. Many times the debt will be moved to a collection agency, or a debt buying agency. Let us know when this happens so we can contact the right people to facilitate settlements.  

6.  Keep a Call Log.  Creditors will continue to make contact by phone; however customers are protected by the Fair Debt Collection Practices Act (FDCPA) which prohibits creditors from engaging in abusive behavior. It is important to review the FDCPA summary included in your welcome packet and keep a log of creditor calls. The name of the caller, the creditor, the phone number, and the date and time should all be included in your log.  

5.  Make your Payments on Time.  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 on time provides our creditor negotiators what they need most, money in your escrow account to settle your accounts. Many of the settlements are arranged over a period of 1 - 6 payments, so we are counting on you making your payments on time each and every month so the money is available.  

4.  Do not believe everything the Creditors tell you.  Creditors and collection agencies have a job to do, and that job is to collect payments. They may tell you a variety of things in order to scare and intimidate you into making a payment directly to them instead of working with a settlement company. Remember that we represent thousands of customers and millions of dollars worth of debt, this puts us in a better position to negotiate with your creditors as opposed to you negotiating with them by yourself.  

3.  Apply Extra Funds to your Plan .  Do you notice a theme? The quicker the funds build in your escrow account, the quicker our creditor negotiators can get to work on settling your accounts. Keep this in mind if you receive a raise, or a bonus at work, or receive a refund around tax time.  

2.  Monitor your Progress.  Being successful is all about setting attainable goals. Try not to think about the Plan taking four or five years to complete, instead focus on getting your first settlement completed within six months, and the second within 12 months. Keep a list of your creditors and cross each one of them off as they are settled. It is a huge accomplishment and it should be celebrated! 

1.  Have Faith and Believe in yourself and your Plan.  Settlement can be difficult, particularly for the first few months. It requires a lot of patience and there are times when customers begin to doubt themselves, and the choices they made. You made the right choice to get help with your debt, and you made the right choice when you selected CareOne to help you get out of debt. Stay on the Plan; it will work if you give it time.  

The Bottom Line:

  • Be an active participant in your Plan
  • Pick the right payment date, payment amount, and make your payments on time
  • Celebrate your victories
  • Monitor creditor communications
  • Have faith and patience 
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  • Should I send all written communication to Careone?  I havent opened them yet.  Dont want to.  

  • Hello sydnp,

    Thank you for reading my blog! Please read your creditor communications. This is a joint effort and we are counting on you! What is the worse they can say? Your account is past due, you owe us money.....You and I both know that doesn't change the fact you can't pay them what they want right now. You joined a plan and we are working together to make that plan work. Please open the communications and let us know what they say.

    Thank you,

    Rob

  • Can you elaborate on #3 "Apply Extra Funds to Your Plan"?  There may be occasions when one could pay a little extra. CareOne does not provide for extra payments on their website. The only way to pay a little extra is by Money Order mailed to them? If that's what it is, then so be it. But if there is a better, faster way, I'd like to know. Thank you for your time.

  • what happens when you are on the plan and one of your accounts was turned over to collections and stating that i was "approved" to be sued in court?  the person that called stated they will garnish my wages or freeze my bank accts. Im getting nervous!!

  • Good morning,

    If you would like send in extra money you can log in to your account, select My Program, and then select the next payment option. You can increase your next payment, which will be deducted from your checking or savings account instead of having to send in a money order.

    Creditors can tell you a variety of things in order to intimidate you and scare you into making a payment directly to them. It is an unfortunatel part of the settlement process. If you have received a legal document from one of your creditors please contact CareOne. A creditor is not able to simply flip a switch and garnish your wages or freeze your bank account, although they want you to think they can.

    Thank you,

    Rob

  • Hello taylor1,

    I have been with CareOne for over a year now and love the program.  I am making monthly payments through the debt management program, but I am about to go through a divorce and I'm worried I won't be able to make the same payments I had in the past.  I am trying to find more information about "debt settlement", and is this something that CareOne offers as well?  Any information you can give me will be greatly appreciated.  Thank you in advance.   Gena K.,  Happy with CareOne :)

  • i send my creditor communications immediately. in the past i would receive a email letting me know u received it. i am becoming very discourged with care one and my attorney. i joined in jan and was very satisfied with the program. now i cant get anyone to return my email or acknowledge they received my fax. i had to apprear in court twice over a creditor. i have final court date in sep. i faxed the final court date papers and again no response, that my fax was received or what i should do?  the credit card co offered me a payment plan with them directly. if i dont settle they will garnish my wages.i check my emails everyday to see what my plan of action should be. no response from care one or my attorney at persels and associates. i received a post card in the mail yesterday to remind me of my upcoming court date in sep.. help? please answer me. what should i do?

  • I have been with careone since 2010..........I started out with debt managment, then switched to dsp.......I still get phone calls all day, I just don't answer them.............I send all correspondance I get to persels.  So far, three debts have been paid one in progress then three more .one pretty large.  I am very happy with my decision and with careone.......You folks need to give it time..........We made this debt, and we need to take care of it.

  • This blog will discuss what you can expect after the 6 th month on your Debt Settlement plan. For many of our customers this is a crucial point in their plan.

  • Deciding to choose settlement as an option for eliminating your debt is never easy, as there are so many things to consider. If you have recently enrolled in settlement you may have questions regarding the tax implications come tax time.

  • Making the decision to participate in a Debt Settlement Plan (DSP) is always difficult, as there are many things to take into account, one of which is the possibility of getting sued. With settlement, unfortunately, there is a possibility of being sued

  • Many of our Debt Settlement customers have been asking about success fee pricing and how it applies to their Plan. CareOne chose to use this fee structure for our Debt Settlement Plan to help differentiate ourselves from other settlement firms and put

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