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Debt Management Service

Debt Management

What to expect from your debt management services

Knowing what you can expect from your debt management service can go a long way to helping you choose a reputable firm to work with. Debt counseling companies should always offer free information on the services they provide and be willing to meet you in person.

You should be offered an initial cost-free, no commitment consultation. At this first meeting you can expect to discuss your entire financial situation with a counselor who may then give you an overview of the debt management solutions open to you. You shouldn't be expected to make a quick decision or to sign up to any debt management service that day.


The counselor should also offer you free educational materials on debt management, budgeting and controlling your spending. Your debt management plan is worthless without these things as you may just fall into the same spending and borrowing habits again.

Once the counselor has advised you on debt management plans they should clearly explain which of your creditors will participate in the program and which will not. You will have to manage the debt yourself for any creditor that will not be included in the debt management plan . The counselor should also explain what effect participating in the program will have on your credit score.

Once you agree on a debt management service the company must give you a contract with a complete breakdown of costs, fees and repayment schedules. This contract must also state what services will be performed, any guarantees about the service and the date by which they will be carried out.

If the organization is offering credit repair, the contract must also explain your credit reporting rights under state and federal law. You must sign the contract for it to become legally binding and the credit repair organization must then keep it on file for two years. After signing a contract you have three days to cancel it without penalty. The contract must explain how to cancel.

Your debt management company should provide you with regular, detailed statements about your account and the best services offer access to your account over the phone or the Internet.

Above all, make sure the debt management service includes advice on long-term money management and help with budgeting in order to avoid a re-occurrence of the problem.