Mistakes to Avoid During a Debt Relief Program

Your monthly deposit is the foundation of your program. Missing deposits delays negotiations and reduces settlement leverage. If you're struggling to make your payment, contact your provider immediately — most can adjust your program payment rather than have you miss it entirely.

Once a credit card is enrolled in your program, stop using it. New charges complicate negotiations and may disqualify certain accounts from settlement. Set these cards aside or cut them up.

Creditors may call directly with settlement offers. Always run these by your debt relief company before accepting. Your provider may be able to negotiate a better outcome — or the offer may include conditions that conflict with your program.

Avoid:

• Opening new credit cards
• Financing large purchases
• Taking personal loans (unless absolutely necessary)

New debt increases your financial burden and can complicate your path to completion.

If you lose income, receive a windfall, or experience a major change in your financial situation, tell your provider. They can adjust your program — and in some cases, a lump-sum payment from a bonus or tax refund can accelerate settlements significantly.

Not every account needs to be enrolled. Before enrollment, discuss with your provider which debts make the most sense to include. A lower-interest credit card you can realistically repay, or a card you need to keep for emergencies, may not need to be enrolled.

The most common mistake is leaving the program before completion. The early months — when you're receiving calls and no settlements have happened yet — are the most difficult. Most of the value comes in the second half of the program, when settlements are occurring and debt is decreasing. Consistency is the most important factor in a successful outcome.