What is a Debt Management Program (DMP)?

A Debt Management Program is a voluntary debt repayment program that serves a dual role of helping people repay their unsecured debts and helping creditors receive the money due them. Typical debts included in a DMP are credit cards, medical bills and collection accounts. CACC negotiates an agreement with creditors to accept a new monthly payment amount. The client sends the money to CACC and CACC disburses the money to the creditors.

What are the benefits of a DMP?

A DMP is a structured way to continue making payments during a period of financial stress.

Usually collection calls stop once a payment plan is in place.

Many creditors reduce, and in some cases eliminate, finance charges for customers paying through a DMP. Numerous creditors will re-age an account to “current” once 3 or 4 monthly payments have been made.

Our professional support staff helps our client's ensure a successful program outcome.

How long will a DMP last?

The average length of a DMP is 36 months. In some cases a DMP may last 48-60 months. The length of
your program will depend on the amount you owe and your specific creditors. Your counselor will estimate the length of you program.

Is counseling confidential?

Unless we have the client's permission, counselors do not discuss a client's financial condition with anyone. In establishing a DMP, however, it is necessary to discuss your information with your creditors.

What debts are covered in a DMP?

DMPS usually include credit card accounts, collections, medical bills and other types of unsecured loans. Secured debts such as a mortgage and car loan are not covered.

Why should I choose CACC?

CACC is a 501(c)(3) not-for-profit credit counseling agency. We are a member of the American Association of Debt Management Organizations©. Our staff adheres to the highest ethical standards.

Can CACC stop legal action and collection calls?

Many of the calls should stop once your payment program has been established. Some creditors, however, may continue to make calls until they have received 3 consecutive payments. Please inform the caller that you are working with CACC and notify us of any creditor calls.

How will a DMP affect my credit report?

Enrolling in a DMP does not affect your credit score. Typically, paying your debts through a DMP gradually improves your credit rating. Most creditors will change you account status from “past due” to “current” once they accept a DMP and you have made 3 or 4 payments through the program.

Will most creditors work with CACC?

Yes, although most creditors are not able to negotiate individually, they have provided guidelines to credit counseling agencies. Creditors also understand the need for the financial literacy education we offer.

Do we have to continue to work with our creditors while we are on a DMP?

Yes, if possible you should continue to make payments until you begin making payments to CACC. We also ask that you monitor your monthly statements from your creditors and notify us of any discrepancies.

Will I be able to get credit again after being on a DMP?

For most clients, the answer is yes. Make sure you shop around for the best rates because some creditor's rates may be slightly higher.

Many clients find that their credit score has improved making them eligible for lower rate credit cards and loans.