Debt management plan (DMP) is a special program introduced by most credit
counseling agencies to help the serious debtors work their way out of debt. But
not all debts can be included in a debt management plan. Although you have
chosen to enroll into a debt management plan, you must do your own debt
management for other debts that are not included in the DMP. Here are 6 debt
management tips for you to work toward debt relief:
Tip #1: Keep record
of your other bills.
A debt management plan typical will include only
unsecured debts such as credit card and personal loans. If you have taken
secured loan such as mortgage or car loan, be aware that those loans normally
will not be handled by a debt management plan. Make you understand which debts
are being paid by your monthly payment to the DMP. For those debts which are not
covered in DMP, make sure you keep a record on the bills.
Tip #2: Make sure
your payment reach your creditors on time
Although you make a single payment
to DMP, it is your responsible to ensure the money is reached to your creditors
on time, else if your payments late, you may incur additional late charges. Find
out when your DMP will disburse payment to creditors and make sure the
disbursement is matched with your billing cycle; if not, you must do an
adjustment either with the DMP agency or notified your creditors and get their
approval to reset the billing cycle to inline with DMP.
Tip #3: Check your
credit card and loan statement
Have your credit card and loan statements
reflect the terms of DMP agreement such as lower interest rates, waived fees or
other concessions from your creditors? If it’s does not show the figures as
agreed in DMP, you must quickly call up both DMP agency and your creditors to
investigate the mismatch.
Tip #4: Check your credit report once a year
In
U.S, you can request your credit report for free once a year. Be sure you do
that and check all the information reported to make sure it is up to date. And,
if you continue to pay your monthly payment on time, you should see an
improvement of your credit rating reflected in your credit report.
Tip #5:
Don’t add more debt with new loans
The rule of thumb to be debt free is:
don’t add more debts to your existing debts. In fact, some of your creditors
will back of the DMP if they found out you are applying for a new loan while
still with DMP. If you really need to get a mortgage or car loan, seek for
professional advices from counselor from counseling service offered by the DMP
agency.
Tip #6: Love your money
If you want the money to love you, you
must love the money. Develop a healthy
relationship with the money. Learn how to manage your money with a budget plan
and know where your money goes. Reduce or cut off unnecessary expenses so that
you have more money to put toward your debt. Take advantage of credit counseling
offered through your DMP agency. Attend the education session about personal
budgeting organized by credit counseling and learn more from their education
materials.
Summary
If becoming a debt free is your goal, then debt
management is your responsibility. Besides enrolling into Debt management
program offered by credit counseling, you need to have your own debt management
plan to cover all your debts if you want to achieve a total debt relief.
Cornie Herring is an author who writes on various finance topics. To find Debt Consolidation, Debt Counseling and other debt solutions visit http://www.debt-consolidation-1stop.info.
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1:13 am on November 23rd, 2008 1
yes i agree with you we must our money…thankyou for your tips