Consumer Debt Relief Programs
New Debt Resolution Plan (DRP)TM debt relief program
The Only Nonprofit, Legally Compliant Debt Concession Program. This program is administered by accredited Consumer Credit Counseling providers. The RDR Institute provides the required RDRSM Debt Assessment for the program. Responsible Debt Relief (RDR) Institute (nonprofit organization) conducts this 3rd party assessment service, which includes your debt repayment score. Based upon that score, we will guide you to the best debt resolution program that fits your specific needs. If you pre-qualify for the DRPTM debt relief program, the Consumer Credit Counseling provider that referred you may be able to offer you this new DRPTM debt relief program. Upon agreeing to the terms and conditions and paying a minimal fee (click proceed button), you will then be directed to call our toll free number to speak with one of our experienced counselors to start the DRP qualification process. The DRPTM debt relief program is currently available in the following states: AK, AL, CA, DC, FL, HI, LA, MA, MD, MS, ND, NE, NM, NY, SD, TN, TX, UT, VA, WA, WV, WY.
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"New Debt Resolution Plan Offers Indebted Households a Nonprofit Alternative to Bankruptcy." - Fox 13 Now Utah
"Debt Resolution Program Unveiled at Capitol" - NPR
There are many debt repayment options available to those who are facing financial trouble. In the current economic environment, with increased unemployment, plummeting asset values, and rising medical expenses, an increasing amount of families are facing financial challenges. The decision to enter a particular debt resolution programs hinges upon the circumstances faced by each family. For instance, those families who have sufficient income but have unmanageable credit card debt, would be most helped by a Debt Management plan offered by an accredited Consumer Credit Counseling provider. On the other hand, a family that cannot make the minimum payments on their credit cards, but can pay a portion of the total debt in a 3 year plan, would be best served by an RDR certified Partial Payment plan, such as the DRP plan. The most effective way to determine which program matches your financial needs is by getting a personalized RDR Debt assessment by calling our toll free number (585) 563-7675. Our friendly and experienced counselors are standing by.
Available options to deal with debt:
- Self-Help Strategies
- Debt Management Plan
- Partial Payment Plan
- Chapter 13 Bankruptcy
- Chapter 7 Bankruptcy
Self-Help Strategies
(A) The first step toward taking control of your financial situation is to do a realistic assessment of your income and your expenses. You can start by using RDR’s budget estimator to find out if your budget is balanced. If it shows that your budget is overdrawn, you can manipulate different expenses to what can be cut out or pared down to leave you with more available cash income.
(B) Second, you should access your FREE credit report to verify your information is accurate and to be aware of your credit history.
Click here: Understand your personal credit report and obtaining a free personal credit report
Click here: Download a quick exercise to guide your Credit Report investigation
(C) Another valuable tool to assist your debt recovery is our Debt Zapper Calculator. This is a quick and easy way to compare the cost of different finance charges of your credit card debt as well as estimating the time it takes to payoff your credit card debt (these calculations can be easily manipulated by entering different monthly payments and interest rates).
(D) Also, learn the Top 10 Tips of Using Credit Cards from consumer finance expert and the founder of Responsible Debt Relief, Dr. Robert D. Manning.
If you have 1 or 2 credit cards and are having difficulty repaying debt, we recommend that you contact your creditors personally to explain your financial situation. Contact your creditors immediately if you’re having trouble making ends meet. Tell them why it’s difficult for you, and try to work out a modified payment plan that reduces your payments to a more manageable level. Don’t wait until your accounts have been turned over to a debt collector. At that point, your creditors have given up on you. The creditor can lower your interest rates and/or develop a work-out plan to repay the debt.
Debt Management Plan
A Debt Management Program (DMP) enables you to consolidate your debt payments into one manageable monthly amount. The Consumer Credit Counseling Service provider will work with your creditors to lower your interest rates and put together a plan to pay down your debts in a much shorter period of time than you are now facing. The credit counselor reviews your financial information and then works with your creditors to arrange reduced monthly payments, interest charges and fees for your unsecured debt. You make a single monthly payment to CCCS and those funds are then disbursed to all creditors on a monthly basis. This plan is ideal for an individual or household that has multiple credit cards (typically 3 or more) with debts above $10,000, and has sufficient income to repay 100% of their debts plus interest.
Here is a list of links that have additional information on Debt Management Plans:
- National Foundation of Consumer Counseling – provides an 800 number to locate an agency near you
- Federal Trade Commission: Choosing a Credit Counselor
- Federal Trade Commission: A must-do list for a DMP
Partial Payment Plan (RDR Certified)
RDR Partial Payment: the patent-pending RDR Net Cash-Flow System an arithmetic estimate of consumer debt capacity that identifies the most appropriate debt resolution plan for consumers. It is locality-specific in estimating household cost-of-living (based on local bankruptcy district), taxes, and discretionary household income. Responsible Debt Relief (RDR) recommends consumers to full-payment Consumer Credit Counseling Services (CCCS) or bankruptcy professionals when appropriate. Those consumers who can repay at least 20% of their household debt are recommended to enroll in a verifiable, “means-tested” partial payment program such as the DRP plan.
Debt Resolution Plan
Responsible Debt Relief (RDR) Institute (nonprofit organization) conducts this 3rd party assessment service, which includes your debt repayment score. Based upon that score, we will guide you to the best debt resolution program that fits your specific needs. If you pre-qualify for the DRP program, the Consumer Credit Counseling provider that referred you may be able to offer you this new DRP Program. Upon agreeing to the terms and conditions and paying a minimal fee (click proceed button), you will then be directed to call our toll free number to speak with one of our experienced counselors to start the DRP qualification process. The DRP Plan is currently available in the following states: AK, AL, CA, DC, FL, HI, LA, MA, MD, MS, ND, NE, NM, NY, SD, TN, TX, UT, VA, WA, WV, WY.
Click here to learn more
Personal Bankruptcy (Chapter 7 and Chapter 13)
Personal bankruptcy generally is considered the debt management option of last resort because the results are long-lasting and far reaching. People who follow the bankruptcy rules receive a discharge — a court order that says they don't have to repay certain debts. However, bankruptcy information (both the date of your filing and the later date of discharge) stay on your credit report for 10 years, and can make it difficult to obtain credit, buy a home, get life insurance, or sometimes get a job. Still, bankruptcy is a legal procedure that offers a fresh start for people who have gotten into financial difficulty and can't satisfy their debts.
There are two primary types of personal bankruptcy: Chapter 13 and Chapter 7. Each must be filed in federal bankruptcy court. As of April 2006, the filing fees run about $274 for Chapter 13 and $299 for Chapter 7. Attorney fees are additional and can vary.
Effective October 2005, Congress made sweeping changes to the bankruptcy laws. The net effect of these changes is to give consumers more incentive to seek bankruptcy relief under Chapter 13 rather than Chapter 7. Chapter 13 allows people with a steady income to keep property, like a mortgaged house or a car that they might otherwise lose through the bankruptcy process. In Chapter 13, the court approves a repayment plan that allows you to use your future income to pay off your debts during a three-to-five-year period, rather than surrender any property. After you have made all the payments under the plan, you receive a discharge of your debts.
Chapter 7 is known as straight bankruptcy, and involves liquidation of all assets that are not exempt. Exempt property may include automobiles, work-related tools, and basic household furnishings. Some of your property may be sold by a court-appointed official — a trustee — or turned over to your creditors. The new bankruptcy laws have changed the time period during which you can receive a discharge through Chapter 7. You now must wait 8 years after receiving a discharge in Chapter 7 before you can file again under that chapter. The Chapter 13 waiting period is much shorter and can be as little as two years between filings.
Both types of bankruptcy may get rid of unsecured debts and stop foreclosures, repossessions, garnishments and utility shut-offs, and debt collection activities. Both also provide exemptions that allow people to keep certain assets, although exemption amounts vary by state. Note that personal bankruptcy usually does not erase child support, alimony, fines, taxes, and some student loan obligations. And, unless you have an acceptable plan to catch up on your debt under Chapter 13, bankruptcy usually does not allow you to keep property when your creditor has an unpaid mortgage or security lien on it.
Another major change to the bankruptcy laws involves certain hurdles that a consumer must clear before even filing for bankruptcy, no matter what the chapter. You must get credit counseling from a government-approved organization within six months before you file for any bankruptcy relief. You can find a state-by-state list of government-approved organizations at the website of the U.S. Trustee Program, the organization within the U.S. Department of Justice that supervises bankruptcy cases and trustees. Also, before you file a Chapter 7 bankruptcy case, you must satisfy a "means test." This test requires you to confirm that your income does not exceed a certain amount. The amount varies by state and is publicized by the U.S. Trustee Program.
Before You File for Personal Bankruptcy: Information About Credit Counseling and Debtor Education
Counseling and Education Requirements
As a rule, pre-bankruptcy credit counseling and pre-discharge debtor education may not be provided at the same time. Credit counseling must take place before you file for bankruptcy; debtor education must take place after you file.
In general, you must file a certificate of credit counseling completion when you file for bankruptcy, and evidence of completion of debtor education after you file for bankruptcy – but before your debts are discharged. Only credit counseling organizations and debtor education course providers that have been approved by the U.S. Trustee Program may issue these certificates. To protect against fraud, the certificates are produced through a central automated system and are numbered.
Pre-bankruptcy Counseling
A pre-bankruptcy counseling session with an approved credit counseling organization should include an evaluation of your personal financial situation, a discussion of alternatives to bankruptcy, and a personal budget plan. A typical counseling session should last about 60 to 90 minutes, and can take place in person, on the phone, or online. The counseling organization is required to provide the counseling free of charge for those consumers who cannot afford to pay. If you cannot afford to pay a fee for credit counseling, you should request a fee waiver from the counseling organization before the session begins. Otherwise, you may be charged a fee for the counseling, which will generally be about $50, depending on where you live, the types of services you receive, and other factors. The counseling organization is required to discuss any fees with you before starting the counseling session.
Once you have completed the required counseling, you must get a certificate as proof. Check the U.S. Trustee’s website to be sure that you receive the certificate from a counseling organization that is approved in the judicial district where you are filing bankruptcy. Credit counseling organizations may not charge an extra fee for the certificate.
Post-Filing Debtor Education
A debtor education course by an approved provider should include information on developing a budget, managing money, using credit wisely, and other resources. Like pre-filing counseling, debtor education may be provided in person, on the phone, or online. The debtor education session might last longer than the pre-filing counseling – about two hours – and the typical fee is between $50 and $100. As with pre-filing counseling, if you are unable to pay the session fee, you should seek a fee waiver from the debtor education provider. Check the list of approved debtor education providers or at the bankruptcy clerk’s office in your district.
Once you have completed the required debtor education course, you should receive a certificate as proof. This certificate is separate from the certificate you received after completing your pre-filing credit counseling. Check the U.S. Trustee’s website to be sure that you receive the certificate from a debtor education provider that is approved in the judicial district where you filed bankruptcy. Unless they have disclosed a charge to you before the counseling session begins, debtor education providers may not charge an extra fee for the certificate.