Debt Management Program

Consolidate debt, regardless of low credit or limited income.

What is a debt management program?

A debt management program (DMP) is a type of assisted debt consolidation. You enroll in the program through a credit counseling agency. It establishes a repayment plan to cover all of your credit cards and other unsecured debts with a single monthly payment. The agency negotiates with your creditors to reduce or eliminate interest rates and future penalties applied to your debts. As a result, you can get out of debt faster even though you may pay less each month.

Learn more about what a debt management program is »

How does a debt management program work?

  1. First, you work with a credit counselor to evaluate your debts, budget and credit.
    Learn more about a debt management program
  2. The credit counselor evaluates your situation to see if you’re eligible to enroll; they also review other options for debt relief that may work in your situation.
  3. If a debt management program turns out to be your best option, the credit counselor helps you enroll:
    1. The monthly payment is set based on what you can afford in your budget
    2. Setup fees are based on state regulations and rolled into your payment plan
  4. Once you find a monthly payment plan that works, the credit counseling agency contacts your creditors to get their signoff:
    1. The creditor agrees to the adjusted payment schedule.
    2. They negotiate to reduce or eliminate the interest rates applied to your debts.
    3. They also stop future penalties and fees.
  5. You make one monthly payment to the credit counseling agency and they distribute it amongst your creditors on your behalf.
  6. During and after enrollment, you have access to free resources to teach you better financial habits that don’t rely on credit cards.
  7. Once you graduate, your credit card accounts are rehabilitated and, in many cases, your credit score may be improved as well.

Find more specifics on how a debt management program works »

Get relief and results with a debt management program

Featured DMP Success Story: Deotha finds relief in spite of initial uncertainty


Deotha encourages anyone in the same situation to push past the uncertainty and make the call. “If someone asked me, I would definitely refer them to Consolidated Credit. The program did exactly what you said it would.”

Keep in mind that the initial credit counseling is confidential, free and has no obligation to sign up for anything. You simply speak with a certified credit counselor to see if your debts qualify for the program. If they do, you can take all the time you need to make the decision to sign up.

Learn what to expect from your first credit counseling session »

Can YOU benefit from a debt management program?

A debt management program has a distinct advantage over other options for debt consolidation. With a DMP, you can consolidate debt regardless of your credit score. Even if you have bad credit you can still be eligible to enroll. This is different from other DIY debt consolidation solutions which require a high credit score in order to qualify for the low interest rates you need.

Benefits of a debt management program

There’s a wide range of reasons why a debt management program could be in your best interest. Here are the main reasons why people enroll:

  1. It can reduce your total monthly debt payments by 30 to 50%.
  2. You can get out of debt in 60 payments or less, on average.
  3. Your interest rates are typically reduced to between 0 and 11%.

Recommended reading: 6 Key Benefits of a Debt Management Program

A DMP and your credit score

Most peoples’ main concern with debt management programs are how enrollment will affect their credit scores. In most cases, as long as the program is completed successfully the effect is positive or neutral. In other words, if your credit score changes at all, it tends to go up.

Learn how DMP enrollment helps boost your credit »

Debt management program FAQ

We’ve gathered up the most frequently asked questions about debt management programs and brought them together to answer everything you need to know!

Find the answers you need in our FAQ! »

Finding the right debt management company

Credit counseling agencies largely provide the same services, but the quality of that service can be very different. We help you choose the right provider for your needs, understanding the similarities in programs offered by different providers.

10 Things to Know about a Debt Management Program

  1. When done correctly, it doesn’t hurt your credit. In fact, your credit can improve.
  2. You pay back everything you owe; you just do it in a way that’s easier on your budget.
  3. The secret is interest rate reduction. It allows more of each payment you make go to paying off your actual debt.
  4. The credit counseling team also negotiates to stop future penalties on your accounts.
  5. You may be able to include payday loans and unpaid medical bills, too.
  6. You may also be able to include debts that have already passed to collectors. This can help stop the debt collection calls that only add to you stress.
  7. Although they’re frozen while you’re enrolled, typically your accounts are reinstated once you complete the program.
  8. Even though you can’t get new credit cards during your enrollment, you can apply for loans. If you need a mortgage or a new car, you can still get approved.
  9. You can use a debt management program to consolidate debt consolidation loans; if you’ve already consolidated on your own successfully, you can roll it into this plan.
  10. Enrollment is ALWAYS voluntary! If you decide the program is not working for you, you can get out at any time and any payments already made will still be credited to your accounts.

Debt management vs. debt settlement

People often get these two debt solutions confused, but they are very different and provide different results.  A debt management program allows you to pay back everything you owe in a way that works for your budget. This means you don’t damage your credit; in fact, your credit can improve once you successfully complete the program.

On the other hand, a debt settlement program eliminates debt for less than the full amount owed. The creditor agrees to discharge your remaining balance in exchange for a percentage of what you owe. This creates a negative item in your credit report that remains for seven years from the date of discharge.

Understand the differences between these solutions »