Debt Management vs. Debt Settlement

CHICOPEE, Mass. (Mass Appeal)  What are the differences between Debt Management and Debt Settlement?  Todd Christian from Cambridge Credit Counseling in Agawam is here with some ideas.

Debt Settlement fees

  • Percentage of the total indebtedness or the amount settled on
  • Tax liabilities if $600 or more in principal is forgiven(check with IRS)

Debt Management fess

  • Free Financial assessment from certified credit counselor
  • If a debt management plan is appropriate then the fees should be small, and upon your ability to pay

Things to avoid in a debt management program

  • Quick payment quotes
  • Claims that they can perform a financial assessment in 5 or 10 mins.
  • Rushing you into a plan
  • Claiming to eliminate your debt.