The Facts

• Consumers can lower their interest rates, eliminate creditor fees and combine several debt payments into one monthly payment by enrolling in a DMP. Enrollment in a DMP is noted on a consumer's credit report until all plan payments are made. While this information does not lower an individual's credit score, some lenders may looked at it negatively.
  
  

Considerations

• Although some consumers may be able to qualify for mortgages while enrolled in DMPs, they should check with their credit counseling agency before applying. Enrollment in some DMPs requires individuals to sign an agreement that forbids them from acquiring any new debt until they have completed their plans, which could take up to four years.
  
  

Solutions

• Individuals can manage their own debt in several ways without enrolling in DMPs. They can negotiate with their creditors directly to lower their payments or interest rates. They can also create a budget to keep track of their expenses and avoid overspending.