If You Are With A Debt Management Plan Or Consumer Credit Counseling Is It Viewed As A Chap.13 On Your Credit?

January 24, 2010

in Debt management

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{ 6 comments… read them below or add one }

gogo7 January 24, 2010 at 3:56 pm

No, they used to until 1999. A study by Fair Isaac (inventor of FICO score) discovered that people on a debt management plan were no more likely to default than other debtors.
Most older bankers and mortgage brokers still don’t know that the FICO scoring system was changed.
That being said, a lender may still be leery about extending credit to you if you are still on a debt management plan. That should not be a negative however, as you are not supposed to incur additional debt until you complete a debt management plan. It defeats the purpose to obtain more debt prior to finishing.

stopccde January 24, 2010 at 4:56 pm

No — but most new lenders will view it as such. You are better off in a 13.

golferwh January 24, 2010 at 5:07 pm

In a way.
Most credit counseling companies will not let you have any additional credit accounts.
I work in auto finance and depending on the lender some will give loans to people in credit counseling and some will not.
Being in credit counseling is not near as bad for your credit as chapter 13 bankruptcy.

SPIFIMAN January 24, 2010 at 5:18 pm

just like filing a chapt 13. And filing bk is not very good advice.

DebtFree January 24, 2010 at 6:11 pm

IT IS VIEWED ALMOST THE SAME. YOUR BEST BET IS TO FILE BK.

Cali Girl January 24, 2010 at 6:41 pm

you are better off with 13
If you go bankrupt, file your bankruptcy under Chapter 13. Chapter 13 permits an US resident to reorganize and restructure their finances. It allows you start afresh and get your finances back on the track. The bankruptcy court will supervise and authorize the entire process of overhauling your financial situation.
While filing for bankruptcy under Chapter 13, you have to draw up a plan of action meant to pay your dues within the next 3 to 5 years and submit to the bankruptcy court. http://get-out-of-the-debt-trap.com/cate…

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