Debt Management Programs

A Debt Management Program (DMP) is applicable to credit card and other unsecured debt, but not to mortgages, auto loans and other secured debt such as student loans, or legal obligations such as alimony, child support and fines.

If you qualify for a DMP, your interest rate and monthly payments will be reduced, and any late fees or other penalties you've been assessed will be waived. In return, you must agree to stop using your credit cards and not apply for additional cards or other lines of credit.

Under a DMP, you will make one payment each month to your counseling firm, which will distribute the funds accordingly to the creditors. In addition to making the monthly payment against your debt, DMPs generally require modest upfront and monthly fees.