Boca Raton, FL (PRWEB) November 15, 2012
When consumers enter a debt management program they need to be aware of some steps that the debt management agency cannot do for them. As long as the person entering the debt management program provides the agency that they choose with the proper balances, account numbers and other pertinent information for the processing of proposals, the accounts will be accepted by the creditors. With these acceptances the debt management client will receive the benefits of the program such as lower payments, lower rates and with some creditors re-aging to a current status on accounts that may have been delinquent prior to acceptance. However once accounts are accepted some issues need to be addressed to avoid credit damage. This has to do mainly with due dates that agencies can no longer change for you.
An example of this would be an account that had a pre program rate of 29.9% that was dropped to 9.9%. After acceptance in a case like this hypothetical account the fixed program payment will be lower than what was required prior to acceptance. Depending on when the account was accepted and when it cycles in the first month after acceptance there may be a past due amount that is the difference between the required payment at 29.9% and 9.9% in the program. What also changes here is that the creditor will not charge a late charge or contact the customer for the past due amount because the account is now on the program so statements must be monitored. For consumers that are more severely delinquent and can’t afford to catch up these past due amounts this is a good thing that they are not being charged for the past due amount nor are they being bothered by the collection department. For DMP clients that can afford to catch these amounts up and are concerned about maintaining and improving their credit it is crucial to get these small past due amounts paid because they can be reported continuously month after month as past due.
In the past most major creditors allowed the debt management agencies to change the due dates on the accounts based on the proposed payment dates that are included with the debt management proposals, this made things much easier on everyone involved. The major creditors no longer allow this and the due dates stay the same as they were before acceptance into the DMP. Now that this is the new policy of most major creditors it is the DMP clients responsibility to monitor this and take steps to be sure these past due amounts that have carried forward are caught up because the debt management agency will not be notified of this by the creditors but the past due amounts will show up on the statements.
THE FOLLOWING TIPS WILL RESULT IN AVOIDING THIS POTENTIAL PROBLEM.
#1. After you have chosen an agency and you have chosen a due date for your single DMP payment for multiple accounts call your creditors and change due dates as is necessary to coincide with your single DMP payment that will be being disbursed to multiple accounts. The majors creditors allow due date changes once a year if the accounts are current.
#2. It is best to call and change these due dates before proposals from your debt management agency are processed.
#3. When you are interviewing agencies to decide which one you will choose see if the counselor suggests this to you before you bring it up. Chances are that if the agency you are talking to doesn’t address this issue they are possibly not that thorough in other areas of their service especially if you have made them aware of the fact that you are current on your accounts. Click HERE for cautions.
#4. Make sure the agency you choose provides you with calculations of your savings and payoff times and also informs you of each individual program rate for all of your accounts. If they just quote one single rate for multiple accounts you are not dealing with a full service agency that practices attention to details.
#5. If you have available credit on some of your accounts that offer lower rates than others explore balance transfers before proposals are processed. Click HERE for rates.
If these simple steps are followed you can not only get out of debt much faster in the program but also improve your credit rating as you pay the balances down.
For more information on specialized debt management click HERE