I recently enrolled in your Debt Management Program
Now what?
Month 1: Transition / Proposal Phase
Timing: DFA has your first payment and the proposal phase has begun.
Your role: Once you have made the first payment to DFA, all creditor calls or questions about the program should be referred to us.
DFA’s role: Review enrollment agreement, client’s creditor statements and send proposal to creditors.
During the first 30 days, DFA will be working hardest for you. When the first payment is received, we will contact each your creditors and inform them of the “proposed payment” and the “proposed due date.”
Troubleshooting
During this phase, your account will usually be moving from the creditor’s Billing (or Finance) department to their debt-pooling department, so you may continue to receive phone calls until the account has been transferred. The transfer should take place within a couple of weeks; however, this transition/proposal phase can last between three and six months. As long as you have made your first payment, you may refer all calls directly to DFA.
Monthly Activity Cycle
1. You make your monthly payment to DFA by certified funds or bank draft.
2. The monies are received and disbursed to your creditors on the 15th or the last day of the month, dependent upon the Payment Cycle you chose. First month only: DFA also sends a written proposal to the creditors.
3. You’ll receive your first statement from DFA detailing the payment amount to each creditor. You should review all your creditors’ statements and check against the DFA statement to ensure payments were posted correctly.
4. Creditors receive payments and post it to your accounts. In most cases, creditors will continue to send a statement showing receipt of monies. Again, review these every month to ensure payments are posted accurately. Note: In some cases, you may be making the next payment before receiving a statement from the creditor.
Reading the DFA Statement:
Download PDF Sample Client Statement
Month 2: What to Look For
Timing: You are now making regular payments, preferably by bank draft.
Critical events: Observation of process and communication between you and DFA.
Your role: Review each creditor statement to confirm your payment was posted. Remember it takes 30 to 90 days for a creditor to respond to a proposal; therefore it will take a couple months for the concessions such as a change in your APR to reflect on the statement. Please be patient.
DFA’s role: Continue to work with creditors in all phases of the process. If there are still delinquent accounts, DFA will make these accounts a priority to receive extra monies to get it caught up and re-aged, as well as any over-the-limit accounts.
Watch out for Collection Agencies!
Collection agencies are generally against debt management programs because these agencies make a living hounding you for money. Often collection agencies will tell clients one of several lies, such as “debt management programs are not approved us” or “We won’t let you be on this plan.” Again refer these agencies to contact us.
Most creditors themselves will accept the proposals, allow concessions, accept the payment disbursement plan and discharge the collection agency. Often when a collection agency receives a proposal from DFA, they’ll turn the account back over to the original creditor.
Months 3 to 5: Working with Creditors
Timing: Your creditors have now received two or more consecutive payments.
Critical events: Three-month audit of your account and finalization of the accounts which will be included in the program.
Your role: You should continue to review your creditors’ monthly statements. During the third month, send a copy of these statements for auditing via fax to 800-435-4686. Please put “Attn: Audit Dept.” on your cover sheet or mail to: Debt-Free America, Attn: Audit Dept., 8575 Gibbs Drive, Ste. 190, San Diego, CA 92123. If you notice any problems contact DFA as soon as possible at 888-268-2926.
DFA’s role: Review of all your creditors’ responses to proposals, follow up on any creditor’s who have not responded and work with creditors for consideration. We cannot force a creditor to make adjustments, etc. However, DFA can push as hard as possible to get you a fair solution and the best possible fix.
Month 6: Auditing Concessions
Timing: You have just about made your sixth consecutive payment.
Critical events: Everything should be set for the duration of the program. We will also be able to identify any issues you may be having with an account and work to resolve it during this audit.
Your role: Send a copy all your creditors’ statements for a six-month audit just as you did in month three. Approximately every six months DFA will send a special envelope for your convenience to repeat this auditing process. You will receive results of the audit which will help you identify how well the program is going.
DFA’s role: Send you a reminder letter requesting copies of your most recent statements. Review your accounts and ensure you are receiving proper concessions from your creditors and wrap up any loose ends with your creditors.