How Debt Management Programs Work

Debt management companies are businesses that help you manage your debt by collecting your monthly debt payment and distributing it to your creditors. Usually a monthly service or administrative fee is taken out of your payment and kept by the debt management company.

Video: Developing a Budget as Part of a Debt Management Program

Debt management companies put you on a debt management program or debt management plan. The company works with your creditors to lower your interest rate and minimum payment to develop your debt management program. These programs typically Debt Managementlast 4-5 years. By the time you complete your debt management program your debt will be completely paid off.

Debt management companies are sometimes known as consumer credit counseling agencies. You can locate one in your area by visiting the National Foundation for Credit Counseling’s website or calling 1-800-388-2227. When you’re considering a debt management company, check out the Better Business Bureau listing. Make sure any negative issues have been resolved.

Choosing a Reputable Debt Management Company

Even though there is a lot of advice against debt management companies, there are some reputable companies out there. A good company will help educate you about your finances and counsel you on your debt rather than push you to sign up for a debt management program. The Federal Trade Commission advises you to get information from debt management companies before enrolling in their services.


Debt Management Company Alternatives

You may wonder if you even need a debt management program is right for you. There are a few alternatives that you can choose from.

• Debt consolidation can reduce your monthly debt payments by combining all your debts into one and paying them off with a loan.
• With debt settlement, you negotiate a lower payment to your creditors. Debt settlement could hurt your credit score since many creditors won’t settle unless you’re behind on your payments.
• Bankruptcy is the last resort and should only be considered when none of the other options work.

Video: Debt Management - Understanding Your Credit Reports

How to Recognize a Scam

There are a lot of debt management companies out there whose only intent is to scam you out of your money. These companies collect your payments but never distribute them to your creditors, causing your bills to fall behind and your credit score to plummet. Here are some warning signs of a debt management company scam.


Debt Management Companies to Choose From

Here is a list of debt management companies that can help you work out a debt management plan with your creditors.

PAFS Credit Counseling
2815 2nd Avenue, Suite 280
Seattle, WA 98121
(206) 374-8839

Alliance Credit Counseling, Inc.
Suite 100
13777 Ballantyne Corporate Place
Charlotte, NC 28277
(704) 943-0332

American Consumer Credit Counseling, Inc.
130 Rumford Ave, Ste 202
Newton, MA 02466
(617) 559-5700

American Debt Resources, Inc
248C Larkfield Road
East Northport, NY 11731
(631) 912-9542

American Debt Solutions, Inc.
902 Clint Moore Rd., Suite 104
Boca Raton, FL 33487
(800) 246-4019

Cambridge Credit Counseling Corp.
67 Hunt Street
Agawam, MA 01001
(413) 821-6919

CareOne Services, Inc.
8930 Stanford Boulevard
Columbia, MD 21045
(410) 910-2774

ClearPoint Financial Solutions, Inc.
8000 Franklin Farms Drive
Richmond, VA 23229
(804) 222-4660

Consolidated Credit Counseling Services, Inc.
5701 W. Sunrise Blvd.
Ft. Lauderdale, FL 33313
(954) 484-3328

Consumer Credit Counseling Services of Greater Atlanta, Inc.
100 Edgewood Avenue, N.E. Suite 1800
Atlanta, GA 30303
(404) 527-7630

Consumer Education Services, Inc.
3801 Lake Boone Trail, Suite 400
Raleigh, NC 27607
(919) 785-0725

Consumers Alliance Processing Corporation #2
5937 Darwin Court #109
Carlsbad, CA 92008
(888) 533-3016

Credit Advisors, Inc.
1850 South 72nd St.
Omaha, NE 68124
(402) 926-2144

CreditGuard of America, Inc.
791 Park of Commerce Blvd #500
Boca Raton, FL 33487
(561) 241-5843

Debt Counseling Corp.
3033 Express Dr. N. Suite 103
Hauppauge, NY 11749
(631) 582-4300

Family Credit Management Services
4304-06 Charles Street
Rockford, IL 61108
(815) 484-1600

Family Financial Education Foundation
724 Front St Ste 340
Evanston, WY 82930
(307) 789-2010

Family Life Credit Services
2345 Meadow Ridge Pkwy.
West Fargo, ND 58078
(800) 747-9307

Greenpath Debt Solutions
38505 Country Club Drive, Suite 210
Farmington Hills, MI 48331
(248) 553-5400

InCharge Debt Solutions
2101 Park Center Drive, Suite 320
Orlando, FL 32835
(407) 291-7770

Lighthouse Credit Foundation, Inc.
2300 Tall Pines Dr., Suite 120
Largo, FL 33771
(727) 535-9653

Money Management International, Inc. #1
13430 North Black Canyon Hwy., Ste 250
Phoenix, AZ 85029
(602) 246-2227

Money Management International, Inc. #2
DBA: Consumer Credit Counseling Services Southwest
13430 North Black Canyon Hwy., Ste 250
Phoenix, AZ 85029
(602) 247-2227

National Foundation for Debt Management, Inc.
14104 58th Street North
Clearwater, FL 33760
(800) 344-5153

Pioneer Credit & Debt Consolidation Services
1644 Concourse Drive
Rapid City, SD 57703
(605) 348-1608

Springboard Nonprofit Consumer Credit Management, Inc.
4351 Latham Street
Riverside, CA 92517-5438
(951) 781-0114

Take Charge America, Inc.
20620 North 19th Avenue
Phoenix, AZ 85027-3585
(623) 266-6100

Visual Credit Counseling, Inc.
1870 W. Prince Road, #39
Tucson, AZ 85705
(520) 650-6144