Credit Counseling FAQ: Do I Stop Paying My Creditors On A Credit Counseling Program?

by Greg on February 19, 2010

This is an excellent question and is usually asked because someone like you has been “pitched” on Debt Settlement rather than Credit Counseling (aka “Debt Management”).

In a Debt Settlement program, your monthly payments are re-directed into an escrow account (which you have full control of), rather than going toward your creditors.

However, in a Credit Counseling program your monthly payments are sent to your creditors each and every month.  Credit Counseling uses lower interest rates to deliver its huge benefits in time and interest savings, and again does not require that you stop paying your creditors in order to force them to negotiate.

(Full disclosure: depending on the program, it is possible that your first month’s payments are used to prepare your case, have our attorney draw up your documents, etc.  But don’t worry – if that is the right program for you, we’ll disclose all the details to you up front).

I always like to hear the various “stories” that our clients have been told in the past – talk to me!



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Mikecombi June 9, 2010 at 3:15 pm

Yeah, it’s good, very useful, thanks :)

jeff cavaliere August 31, 2010 at 6:12 pm

Thank you very much for posting this good information! I am looking forward to checking out more!

HTML Forms October 5, 2010 at 5:20 am

last few days our group held a similar discussion about this subject and you show something we have not covered yet, thanks.

- Laura

Carter Armbruster June 5, 2011 at 1:34 pm

Thanks for a really interesting read, learn quite a few tips here, trying hard to improve my credit , i did a consumer proposal 7 years ago and just now i am starting to rebuild my credit slowly but surely and trying to avoid that credit card trap.

admin June 5, 2011 at 3:12 pm

Thanks for the kind words, Carter… If you have any questions, or we can help, just let me know.

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