A debt management plan is a service provided by the Ontario Association of Credit Counselors. These are non-profit agencies created to help individuals experiencing financial distress.
Debt management plans are designed for people who can afford to repay all of their debt over a period of time, but are unable to qualify for a debt consolidation loan, and require a period of time to make the repayments.
In a debt mananagment plan the non-profit credit counselling agency "pools" your unsecured debts together so that you are only required to make a single monthly payment (to the not-for-profit agency). The agency then divides your payment amongst each of your creditors, with the larger creditors getting a bigger share of payment.
Some of the advantages of a debt management plan are:
A debt management plan is not a legal procedure - it is a voluntary agreement between you and your creditors. As such, it does not need to include all of your creditors, nor is it binding on your creditors. A debt management plan also does not have the ability to automatically stop a garnishment order - the creditor must agree to lift the garnishment.
To see if a debt management plan is right for you, contact a local Credit Counselling Agency where you live and book a consultation to meet with a counsellor in person. They are experts in financial education, credit counselling and debt management programs. These agencies recognize that there are people that simply prefer to sit down and discuss their options face to face and they are pleased to be able to provide this level of personal attention and service.
If you prefer to deal with a credit counsellor over the phone, you can contact InCharge Debt Solutions at 1-866-816-6547. They provide over the phone credit counselling and debt management plans.
Even though debt management plans and the agencies that provide this service have been around for a long time, very few people in Ontario are aware of this procedure. If you have the ability to repay 100% of your debt it a debt, management program may be solution that you've been looking for.
If you think a debt management plan would work for you, go to our page on Credit Counselling for a list of the agency in your area.
If you feel that you can only afford to repay a portion of your debts, we suggest you contact us at 310-PLAN or e-mail us to set up a meeting to discuss a consumer proposal or possibly personal bankruptcy.