/C O R R E C T I O N -- Consumer Credit Counseling Service of Greater Atlanta/

Debt Repayment Plan Interest Rates Drop

Consumer Credit Counseling Service of Greater Atlanta Reports Better Terms for Credit Card Debtors

ATLANTA, Nov. 9 /PRNewswire/ -- With millions of Americans struggling to repay their credit card debt, it may be a good time to consider a debt management plan (DMP) offered by many nonprofit credit counseling agencies. That's because people with large balances and high interest rates who enroll in a DMP are receiving favorable repayment terms from a variety of creditors, according to Consumer Credit Counseling Service (CCCS) of Greater Atlanta.

Consumers who enroll in a Debt Management Plan (DMP) now typically will receive interest rates from many creditors ranging from 6% to 10%, compared to a range of 10% to 14% last year, the agency reports. Many people who opt for a DMP to repay their unsecured debt are prompted to seek help after late payments have caused their credit card interest rates to soar to 28% or more.

"These lower rates should help a larger group of people get on the path to repaying their debts," said Rick Phillips, vice president, Debt Management Plan Services for CCCS of Greater Atlanta. "A DMP provides a long-term strategy to get debts under control with greatly reduced interest rates."

The lowered rates are only available to clients beginning a new DMP.

A DMP is a repayment plan that provides a systematic method for paying down outstanding debt. Consumers make a single payment to a nonprofit credit counseling agency like CCCS, which acts as a trustee in distributing the funds to creditors. CCCS works with both clients and creditors to design a repayment program that minimizes monthly payments, interest and related fees, providing a manageable tailored plan for the client. This enables the client to repay their entire debt obligation at more favorable terms, and on a plan that is within their ability to pay.

The repayment period varies based on amount owed and the repayment terms. The average debt management plan is structured to repay debt in 36-60 months.

Before entering a client into a DMP, CCCS counselors first collect a client's monthly income and spending information during a free and confidential counseling session. After the budgeting session, the client is presented with repayment scenarios based on staying on their current course or signing up for a DMP. Typically a DMP results in reduced interest costs and consequently a potential for lower monthly payments, especially when interest rates on credit card debt are much higher than 10 percent.

CCCS of Greater Atlanta reports that its DMPs have a high success rate. About two-thirds of the agency's clients - 65% - either paid off their creditors or felt they had sufficient control of their debts to assume control themselves.

Debt Management Plans, which are offered by many nonprofit credit counseling services, are significantly different from debt settlement plans, which are offered by for-profit companies.

DMPs enable consumers to get back on track by making smaller payments over a period of time to pay down their debt. Debt settlement companies typically delay contacting the creditor until collecting enough money from the debtor to have sufficient cash to begin negotiations on the account.

About CCCS of Greater Atlanta
CCCS of Greater Atlanta serves clients in all 50 states and has 33 offices in four states. It is the headquarters for the CredAbility Network, a family of nonprofit agencies serving consumers in north Georgia, south and central Florida, middle Mississippi and east Tennessee as well as nationally via telephone and Internet.

CCCS is accredited by the Council on Accreditation and is a member of the Better Business Bureau and the National Foundation for Credit Counseling (NFCC). Governed by a community-based board of directors, CCCS is funded by creditors, clients, contributors and grants from foundations, businesses and government agencies. CCCS offers around the-clock help by phone at 1-800-251-CCCS or at its Web sites, www.cccsinc.org and www.cccsenespanol.org.