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Debt Management Plans

What is a DMP

Debt Management Plans, which are often called DMPs, are plans that allow debt relief providers to work directly with creditors to secure benefits. These benefits, which vary by creditor, typically include reduced interest rates, lower monthly payments, waived fees such as late fees and over the limit fees. If the DMP works within your budget, you may find this to be your first and best option. Learn why by using the links below.

What are the Pros and Cons of a DMP?

It is important to understand how a debt management plan works before you enroll. Here we outline the key benefits and considerations of debt management to help you further in your decision process about the best plan for you.

Pros

  • Most creditors reduce interest rates and eliminate late fees
  • Most creditors reduce your monthly payments
  • One consolidated payment for your unsecured debts
  • Benefits typically begin after 3 timely payments
  • Collection activity should stop quickly
  • Debt is repaid in full
  • Less negative credit impact than settlement

Cons

  • Some creditors do not participate
  • You may not take on any additional debt while on the program
  • You must make consistent monthly payments to ensure benefits continue

Debt Management Provider Checklist

Choosing the right provider for your debt solution, whether it is debt management or settlement, is critical to your success. Read below to see how CareOneSM Providers compare to others.

Service Other Providers The CareOne Providers
Solid record with the Better Business Bureau (BBB) Important to check
Online Statements Important to check
Free educational resources Sometimes
Monthly Newsletters Sometimes
Certified Counselors Sometimes
24-hour account access, online or by phone Sometimes
Electronic payment processing Sometimes
Existing relationships with over 150,000 creditors Rarely
Online enrollment Rarely
Other options available besides DMP Rarely
Online community with thousands of existing members Unlikely

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