Debt Management Plan
How It Works
A debt management plan is designed for people who need extra help paying off personal debts. The most important benefit of a debt management plan is the consolidation of multiple monthly payments into one monthly payment. This may result in a lower total monthly payment. In addition, creditors will typically stop collection calls, reduce interest rates and finance charges, waive late and over-limit fees and bring accounts current. Here's how the process works:
Step 1: Get Started with Credit Counseling
During your initial credit counseling session, one of our certified credit counselors will review your finances, provide you with educational tools and resources, and develop a personalized budget and action plan. They will also determine whether a debt management plan will help you reach your financial goals. To get started, simply fill out our online form or call 1 (866) 528-0588 to speak with a credit counselor. Please be prepared to discuss the following information:
- Your annual income, including alimony, child support, bonuses and commission, if applicable
- Your current monthly expenses, including items you may not purchase on a daily basis, such as home maintenance, vehicle repairs, medical copays and prescriptions
- If credit card debt is one of your challenges, please be prepared to review creditor minimum monthly payments, current balances, and any special repayment programs or payment arrangements made with your creditors
Step 2: Review and Activate Your Plan
Your credit counselor will suggest a debt management plan if your budget indicates you can afford it, and we believe your creditors will offer concessions, such as reduced interest rates or waived fees.
If we recommend a plan, we will provide you with a debt management agreement to review and sign. The agreement will contain your budget analysis, creditor list and balances, and estimated monthly payments. To activate your account, you will need to sign and return your agreement along with your first payment, if required.
Step 3: Propose New Plans to Creditors
Once your plan is activated, we will notify each of your creditors that you are enrolled in our program and propose new payment plans. After the proposed plans are approved, creditors will typically change the terms of your original agreements. New terms may include:
- Acceptance of the proposed payment plan
- Reduced interest rates and finance charges
- Waived late and over-limit fees
- "Re-aging" of your accounts to bring them current
Step 4: Work with a Certified Credit Counselor
A certified credit counselor will be assigned to your account to guide you throughout the debt management process. Your counselor will provide support and encouragement to help you:
- Manage your account and monitor your progress
- Gain access to financial education, tools and resources
- Develop effective spending habits, budget to meet living expenses and save for the future
- Follow an action plan to pay off your enrolled debt and reach your financial goals
Step 5: Make Regular Payments to TCA
You will submit one payment to Take Charge America each month, and we will disburse your payments to multiple creditors and service providers. We will also provide you with a monthly Account Activity Summary where you can review your progress, a list of payments received, fees retained by Take Charge America and payments disbursed to creditors.
Step 6: Take Advantage of Educational Resources
After your initial credit counseling session, you will be able to take advantage of the free educational tools and resources we provide at MyTCA.org. Once you have enrolled in the Take Charge America debt management program, you will have instant access to TCA BudgetPro, our proprietary budgeting software, as well as eLearning courses, a Personal Finance eBook, financial calculators and advice from The Budget Doctor®.
Your credit counselor will be available to answer any questions and provide you with support to reach your financial goals.
Financial relief is within reach! Call 1-866-528-0588 or click here to get started with your initial credit counseling session and learn how debt management may help you reach your financial goals. For more information on credit counseling, please visit our Debt Management FAQ's.