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FAQ’s (Frequently Asked Questions) Who is Credit Foundation of America (CFA) and how can they help me? What is a Debt Management Plan (DMP) and how does it work? How does being enrolled in a DMP affect my credit? My creditors are still calling me; what should I do? Why do creditors participate in your program? How much does it cost to be enrolled in a DMP? Will my accounts remain open? Will I still receive statements from my creditors? My creditor statements reflect late charges, over-the-limit fess and the same interest rate. When will that stop? Does CFA send a monthly statement? How do I make payments? Is there a grace period? What do I need to do if I change bank accounts or move? As a creditor is paid off, is my payment to CFA reduced? How can I get more credit counseling? How can I obtain educational materials? Who is Credit Foundation of America (CFA) and how can they help me? CFA is a 501 (c)(3) non-profit organization dedicated to providing effective solutions for individuals and families in need of financial education and counseling, and to guide consumers out from under the burden of unsecured debt. Our program may also include the coordination of repayment to your creditors through one convenient, affordable monthly payment if a debt mangement plan is right for you. CFA is a fully bonded and insured Debt Management Agency, accredited by the prestigious British Standards Institute (BSI) for its Quality Mangement System. What is a Debt Management Plan (DMP) and how does it work? Although a DMP is not for everyone, if this is the best way for you to get out of debt and enjoy a quality of life prevented by such debt, we would be more than happy to assist you. A DMP is an indivdualized plan based on your specific budgetary and financial situation. Your credit is analyzed and a budget created that will help you manage one monthly payment from the consolidation (combining) of your unsecured debts. How does being enrolled in a DMP affect my credit? Credit Foundation of America does not report your information or DMP status to any credit bureau. However, upon entering into a DMP, your credit cards will be temporarily closed for the duration of your DMP. Creditors do reserve the right to report that you have enrolled in a DMP as a notation on their individual entry. CFA has no control over credit reporting decisions. Some clients may experience a short term affect on their credit report, however, we know of no long term negative impact. In the long run, a DMP is better than not paying your bills or filing for bankruptcy. For more information on how credit is scored, visit our “Financial Links” page. My creditors are still calling me; what should I do? If you are enrolled in a DMP and creditors are still calling, please inform them that you are enrolled in our program and that they can contact our customer service regarding your account. Please be sure to provide them with your enrollment number, enrollment date, and customer service number. Why do creditors participate in your program? Creditors are interested in repayment of the funds they expended on your behalf. Participation in our program assures them of that repayment. Our debt management programs give you an opportunity to pay off your debts in a timely manner with manageable payments. Be aware that not all creditors participate in debt management programs and may not offer lower interest rates or other benefits. We will, however, continue to negotiate with them on your behalf. If this is the case and you have a creditor that does not participate in a DMP, we can still include your current payment to them as part of your monthly account activity to ensure repayment. How much does it cost to be enrolled in a DMP? Although we are a non-profit agency, there are certain administrative costs that we incur. Therefore, there is a minimal monthly account maintenance fee built into your payment. The actual amount may vary depending on the individual state regulations, but will never exceed $39.00 per month. Will my accounts remain open? When enrolling in a DMP, our combined goal is for you to become debt-free. Any purchase activity would undermine this goal. In order to control the temptation to add debt to the accounts, they will be closed for the duration of the program. Should you choose to resume activity on the accounts, you may do so after the completion of your DMP. Will I still receive statements from my creditors? Your creditors will continue sending monthly statements that reflect payments made from CFA. My creditor statements reflect late charges, over-the-limit fess and the same interest rate. When will that stop? Creditors establish their own policies on these issues. Some, but not all creditors are willing to waive partial or full funds on fees incurred and/or will lower your interest rates. When you enroll in a DMP, there is a “transition period” that may last up to 3 billing cycles (or 90 days) that your creditors use as a time to negotiate a feasible agreement (proposal) with CFA. During that time, your payments to CFA may not reflect on your current statement. Once the proposals are accepted, however, you will see the payments you have made to CFA reflected on your individual creditor statements, and the fees should be waived. Does CFA send a monthly statement? Absolutely. Statements sent to you from CFA will refelct a breakdown of payments made to each creditor and your remaining balance. Please refer to your most current creditor statements for exact balances and interest rates. The remaining balance shown on our statement is an estimation only. We request that you send us updated copies of your creditor statements every 90 days. How do I make payments? To make the process easy and consistent for you, we electronically draft your monthly payment from your checking or savings account. Payment dates are scheduled on either the 1st or 15th of the month, but can be adjusted based on your creditor payment dates. It is your responsibility once you are enrolled in our debt mangaement plan to make sure your creditor payment dates all reflect a date at least 5 days after the date you agreed to have us transfer funds from your account to give us sufficient time to distribute the payment. Can I change my payment date? Yes. Please give us at least 5 business days’ notice before the scheduled payment date. Notice must be given in writing so as to avoid any discrepancies to your account. When making changes to your scheduled CFA payment date, please be sure to adjust your payment date with your creditor to reflect a date at least 15 days after the new scheduled CFA payment date. This is necessary to avoid late payments from your creditors. Is there a grace period? No. Making payments to your DMP is necessary to help you stay consistent and disciplined with your finances. In addition, missing payments on your DMP may cause you to incur late fees with your creditors that may increase your interest rates, or be grounds for dismissal from your DMP. What do I need to do if I change bank accounts or move? Please contact our Customer Service Department immediately and let us know your new information. Change of address information can also be faxed to our secure line at (949) 716-2200. When we receive your new information, we will update our records accordingly. If possible, please let us know a week in advance of any changes to your account and/or billing information, including change of telephone number. As a creditor is paid off, is my payment to CFA reduced? No. In order for you to become debt-free as quickly as possible, the amount that was applied to a creditor that has been paid off will be applied to payments to your other outstanding balances. If you would like a specific creditor to receive the funds, please notify a Customer Service Representative in writing as soon as possible. How can I get more credit counseling? For additional counseling on how to manage your finances, please contact our Education and Community Outreach Department at 1-888-650-5560, or email info@cfofamerica.org. How can I obtain educational materials? To order a FREE copy of our financial literacy program, please contact our Education and Community Outreach Department at 1-888-650-5560, or email info@cfofamerica.org. You may also obtain more information through the “Financial Links” or “Financial Education” links on our website. To order a copy of our financial literacy workbook titled, Financial Literacy Program on Money, Debt and Credit via mail, please write: Credit Foundation of America 9501 Jeronimo Road, Suite 120 Irvine, CA 92618 Attn: Education and Community Outreach Dept. |
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