A useful debt plan begins with two questions: what kind of debt is involved, and what action is needed now? Use the sections below to find relevant resources before agreeing to a new payment plan or paying a company for help.
If You Received Court Papers or a Garnishment Notice
Read the documents and record the response dates. Contact local legal assistance promptly to understand the process and any options available.
The CFPB explains why responding to a debt lawsuit matters. Do not assume that contacting the collector, disputing the balance, or starting counseling replaces a court response.
If money is being withheld from wages or an account, ask a qualified legal resource about the notice and applicable protections.
If the Debt or Balance May Be Wrong
Gather statements, payment records, and collection notices. Check the creditor’s name and the amounts claimed. Identify charges you do not recognize or payments that appear missing.
For collection accounts, review the CFPB’s debt validation guidance. Written disputes made within the applicable validation period can trigger specific protections. Follow the notice’s instructions and keep proof of your response.
A collection dispute and a credit-report dispute are separate processes.
If Credit Cards or Personal Loans Are the Main Problem
Contact the creditor and explain what you can realistically afford. Ask whether it offers a hardship arrangement, payment-date change, or other assistance.
Clarify whether interest continues, fees apply, or account access changes. Obtain the terms before deciding.
For credit card accounts, start with the CFPB’s payment difficulty guidance. Personal loan options depend on the lender and agreement.
If Medical Bills Are the Main Problem
Ask the provider to explain the bill and how insurance was applied. Request its financial assistance policy and application instructions.
Check assistance before agreeing to medical financing. A new credit product may introduce costs or affect how you can resolve the original bill.
The CFPB’s medical financing guidance explains questions to consider.
If Student Loans Are the Main Problem
Use Federal Student Aid’s repayment resources for federal loans. Its repayment calculator guidance explains how to compare estimated payments and total costs.
Confirm available options with your servicer. Estimates do not establish final terms or guarantee forgiveness. For private loans, contact the private servicer about its own programs.
If a Debt Collector Is Contacting You
Verify who is contacting you and request the information needed to recognize the debt. Keep correspondence and notes.
Review the CFPB’s guidance on responding to collectors. Before making a payment on an older debt, seek advice about its status and the potential consequences under applicable law.
If You Are Managing Several Debts
List balances, payment requirements, interest rates, and whether a home or vehicle secures an account. Protect essential living expenses when assessing what is affordable.
A reputable credit counselor can help evaluate your situation. Ask about qualifications, fees, services, and creditor participation. Use the FTC’s guide to finding debt help to compare providers.
Before Enrolling in a Debt Relief Program
Understand whether the offer involves counseling, a debt management plan, settlement, or a new loan. These are not interchangeable.
Ask about fees, risks, cancellation terms, and what happens if creditors refuse. Settlement may involve collection activity, additional charges, credit damage, and possible tax consequences.
Review the CFPB’s explanation of debt assistance services. Do not rely on guaranteed savings or promises that all debts will disappear.
If Your Current Arrangement Is Not Working
Contact the creditor or organization managing the arrangement. Explain what changed and request a payment history, outstanding balance, and explanation of available changes or cancellation terms.
Verify where your payments went before entering another program. An existing enrollment does not necessarily stop interest, collections, or legal action.
If Your Debt Involves a Home Vehicle or Taxes
For a mortgage, use CFPB mortgage assistance resources. For an auto loan, contact the lender about account-specific options; the vehicle may be at risk if payments are missed.
For federal taxes, review the IRS payment agreement information. State taxes require resources from the relevant state agency.
