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What is a Debt Management Plan

High credit card interest rates can make it nearly impossible for you to get out of debt in a reasonable amount of time. If you can only afford to make the minimum payments on your credit cards, you could be in debt for years...even decades! That's because when you have high credit card interest rates, more of your monthly payment is applied to interest, rather than to your actual balance. A Debt Management Plan is a viable solution for many consumers in this situation.

Is a debt management plan the right option for me?

A Debt Management Plan, also called a "DMP", is a customized bill repayment program designed to help you pay down your debt in a reasonable amount of time with the least amount of cost to you. Working with each of your creditors, we will establish a debt management plan that consolidates each of your bill payments into one simple, affordable monthly payment. Creditors often extend a variety of benefits when you enroll in our debt management plan to help you reach your goal in becoming debt free. These benefits are easily obtained when working with a credit counseling agency.

Does Everyone Qualify for a Debt Management Plan?

To see if you qualify for a debt management plan, you will need to participate in a personalized, one-on-one debt analysis with one of our nationally-certified credit counselors. Our counselors will review your income and expenses, and provide you with options appropriate to your unique financial situation. If your financial assessment indicates that, despite your income, you won't be able to pay down your unsecured debt in a reasonable timeframe without significant concessions from your creditors; your counselor may suggest that you enroll in our debt management plan. However, our counselors will only offer a debt management plan if it is in your best interest.

What are the benefits of a Debt Management Plan?

Since Cambridge is a nonprofit agency; most creditors will offer certain benefits that could help you pay off your debts faster than you could on your own, typically within a 4-5 year timeframe. These benefits can include reducing your interest rates, bringing your past-due accounts current, and eliminating or reducing your late and/or over-limit fees. Clients of Cambridge receive an average of 64% reductions in their interest rates, and average monthly payment savings of 25%.

In addition to these benefits, you will also get the added advantage of having one of our professional, certified credit counselors available to guide you throughout your debt management plan enrollment. They will provide you with a free financial assessment to review your finances and construct an affordable payment plan with a pay date of your choosing, so that you can start working towards becoming debt free. You'll also have access to your account information online and you'll be able to speak with our experienced team of client services professionals who work diligently to ensure that all of your accounts are properly serviced throughout the course of your debt management plan.

Schedule a FREE debt consultation with one of our certified counselors!

Why Choose Cambridge for a Debt Management Plan?

If you become a credit counseling client, you’ll make one payment to Cambridge and we will disburse individual payments to each of the creditors you’ve included on our program. As a result of your enrollment with our agency, your creditors may offer certain benefits to help you get out of debt faster, while often saving you money in the process. One of the most significant benefits that creditors typically extend to clients of a consumer credit counseling agency is a reduction in your credit card interest rates. In fact, our typical clients’ interest rates are reduced by an average of 14 points – from roughly 22% down to just 8%.

These interest rate reductions will also allow many of our new clients to save money, too. Our typical clients save an average of $142 per month due to these interest rate reductions. This extra money can be used to either build savings or pay down other debt that you may not have included on the program. There are many other benefits to enrollment in our program, and your credit counselor will discuss them with you during your free consultation.

Why choose Cambridge Credit Counseling?

Cambridge has been providing consumer credit counseling and financial education services nationwide since our inception in 1996. Our nationally certified counselors are among the most respected in the profession, averaging more than 12 years’ experience in helping people get out of debt. Cambridge is a 501(c)(3) non-profit agency with an A+ Better Business Bureau rating, and we’re proud to be the top-rated credit counseling agency by Cambridge is also a HUD-approved housing counseling agency, and we provide both bankruptcy and reverse mortgage counseling services. For a complete listing of license information, please visit our credit counseling disclosures page.

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