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• Provided the counseling service can negotiate more favorable terms with your creditors, you will be placed on a debt management plan. Your counseling service will indicate to you which credit accounts have been accepted, what the new interest rates are, and what the new monthly payment will be on each account. Additionally, the plan may come with stipulations set forth by the creditor. These may include closing an account or making a committment not to apply for new credit.
• The credit counseling service will collect one monthly payment from you and disburse it to the creditors. This is not a consolidation loan, as the accounts still remain in your name. The counseling service, provided you send your single payment in on time, will ensure the payments reach the creditors on time. Creditors may require this as part of the plan. You are still allowed to pay your creditors directly, but you must first be sure to pay the counseling service the agreed upon monthly amount. This monthly amount is typically the sum of the new minimum required payments plus any fees or voluntary contributions.
• The credit counseling service will provide tracking and reporting of your payments, often via web-accessible login. The service should provide you with a monthly statement indicating which credit accounts are on the program, the interest rate of each account, the payment sent to each account, as well as forecast of the remaining balance and time remaining on the program. Counseling services may also show you much money you are saving with the lower negotiated rates versus the higher rates.
• Credit counseling also provides, well, counseling. When enrolled in a counseling service program, expect to receive information and pamphlets about managing your money, establishing a budget, and more details on the perils of debt. You may also be required to participate in workshops or counseling sessions — either in person or via the phone — to discuss your specific financial situation and develop a custom debt management solution for you.

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