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How will my creditors know I have joined a Debt Management Program?

Before your first plan payment, we will notify your listed creditors that you joined a debt management program. This notification, called a proposal, includes the account number and open balance you provided at the time of your enrollment, as well as the program payment indicated on your Repayment Schedule. In most cases, creditors accept proposals. If any of your creditors request any changes before accepting the proposal, we will immediately contact you.

If you are receiving collection calls, the collection agent may not be aware of a proposal from our Plan until the benefits are granted.

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Why have my creditors stopped my Debt Management Plan benefits?

Your creditors might stop applying benefits due to some of the following reasons:

1. Skipping Payments:
Skipping a payment could affect benefits with your creditors since they expect to receive payments every 30 days. When you skip a payment, creditors are within their rights to charge late fees and higher interest rates, especially if you do not make up that payment. If you lost benefits due to missed payments, we will encourage you to contact us to make up the missed payment and then we can send a new proposal to the creditor.

2. Paying outside of the program:
You can lose your program benefits if you send payments to your creditors outside the program. Please avoid sending payments directly to your creditors. Contact us if you need to make extra payment and we can increase your next payment amount.

3. Opening new credit accounts:
By opening any new accounts after joining the program, you could risk your benefits. Please contact us if you are not receiving benefits, but you have not missed any payments and have made more than three consistent payments on the program. A CareOne representative will contact your creditor concerning your benefits, then we will contact you once there has been a resolution.

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Can I buy a car or house while I'm on the Debt Management Plan?

This depends on the lender and also on how well you are making consistent monthly payments. Before approving a mortgage or car loan, a lender wants to know that you are creditworthy. If they can see that you are making consistent and timely payments and that your debt to income ratio has gone down, it may be helpful. The Debt Management Plan can help you do both of these. It is important to note that if you enroll in a Settlement Plan, however, that it is highly unlikely you will be able to secure a mortgage or car loan until the Plan is complete and all of your debts have been settled.

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How long does it take for the creditors to accept the Debt Management Plan proposal?

If you are enrolled in a Debt Management Plan, your creditors will receive proposals within seven to ten days of your program enrollment. It will often take four to seven weeks for them to process the proposal. Most creditors require three consecutive payments through the debt management program before they will offer benefits. Often your creditors may notify us only when the proposal is declined. In this event, we will research the cause and work with you and your creditor to make the necessary changes to have the proposal accepted. Please check your creditors' statements to see if they have started applying benefits.

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Do I need to continue sending payments to my creditors after I have signed up for a Debt Management Plan?

As you get started on the Debt Management program, it’s critical for you to get off to a solid start with timely, consistent payments. We suggest to our new customers to make sure that they set aside the money to make their first plan payment. If there’s money leftover and you have credit card payments due before the plan gets underway, go ahead and pay the bills. If you’re not able to pay the credit card payments due before the plan goes into effect, you may see late fees reflected on your next creditor statements. Keep in mind that these late fees are typically eliminated after three consecutive payments on our program.

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