Debt management, often known as a consumer credit counseling or a credit counseling service, is a creditor-sponsored program designed to help you pay your debts back. With debt management, you are still paying everything in full with interest.

In this program, all the debts are merged into one account so that you only have to make one payment a month instead of having various payments during the month.It used to be, that in a debt management plan, the credit card companies gave large concessions in the form of very low interest rates.

Today, unfortunately, credit card companies do not reduce interest rates as much on this type of program. Depending on where you are right now, you may actually see the interest rates go up.

Additionally, for anyone that gets paid weekly or bi-weekly, it may be harder to pay one monthly payment while keeping current on the other monthly expenses they may have. If you miss a payment in a debt management plan, you may be booted out of the program and may not be able to re-apply for it again or for a significant period of time.

In a debt management plan, all credit cards will be canceled and the ability to take on new credit is not allowed until the program is complete. Also, creditors who are in the debt management plan will not offer more credit while you are still in the program.

In many cases, the payment will go up because the debt management company or credit counseling firm is charging you a monthly fee for their services. The reason for this is that credit card companies are not paying them as much as they used to for the management of this type of program, and there is a lot of overhead associated with it.

Many lenders have informed CuraDebt that they regard a person who is in a debt management plan as if they were in a Chapter 13 Bankruptcy because a third party is paying back the debt for the consumer. Each lender is going to look at a credit report differently.

You must understand that in a debt management plan, your credit report will state that a third party is paying back these creditors. This is because you make a payment to the credit counseling agency and it makes payments each month to the creditors.

The bottom line is that in a debt management plan there used to be many benefits. Today, in most cases the interest rates don’t go down much. The debt management company is often charging a monthly fee. You have one big payment to make each month so it could be harder for you to pay.

Your credit report shows that you are in the program. At the same time, if you are paying very high-interest rates and want to bring them down and save money in interest, it may be a plan to consider.

CuraDebt can help you understand this type of program so that you can make an educated decision. Speak with a CuraDebt counselor, at no obligation, to go into more detail and to analyze your financial situation: your payments, your interest, the terms of the accounts you have, and your current economic situation.

You may find that another type of program such as debt settlement or debt negotiation, designed to save you money and help pay your debts off sooner, would be better for you and your family.

Call 1-877-850-3328 for your free consultation.