CCRS discloses three debt adjustment programs based on delinquency period

The Credit Counseling and Recovery Service has released an educational video detailing three debt adjustment programs, including an Individual Workout that may allow for principal reductions of up to 90% for those delinquent for 90 days or more.

The specific stages and support details of debt adjustment programs operated by the Credit Counseling and Recovery Service (CCRS) have been disclosed to alleviate the suffering of debtors facing economic difficulties. An educational video released by the CCRS details three core workout programs tailored to a debtor's situation, ranging from the period before delinquency occurs to long-term delinquency status.

Three debt adjustment programs categorized into Fast-Track, Pre-Workout, and Individual Workout

CCRS debt adjustment is largely divided into three stages depending on the period of delinquency. According to the video, the CCRS provides three types of workouts: Fast-Track Debt Adjustment, Pre-Workout (Pre-debt Adjustment), and Individual Workout.

The first mentioned, "Fast-Track Debt Adjustment," is a system available when delinquency has not yet occurred or the delinquency period is 30 days or less. It is designed to respond at the point when anxiety due to delinquency begins.

If the delinquency period is between 31 and 89 days, it moves to the "Pre-Workout" stage. The video compares this to a "booster" or "pre-workout" that warms up the body before exercise, explaining that it is effective to respond before the delinquency becomes prolonged and the problem grows. At this stage, the debt burden is eased by lowering interest rates or extending repayment periods in accordance with income levels.

The final stage, "Individual Workout," is a system for long-term debtors whose delinquency has lasted 90 days or more. In this stage, a portion of the principal may be reduced considering repayment ability, and depending on the situation, a principal reduction of up to 90% is possible. However, individuals must confirm which system they qualify for through direct consultation.

Risks of revolving services and card usage methods to improve credit scores

As much as the debt adjustment programs, daily credit management and proper consumption habits were emphasized. The video warned of the dangers of the "revolving" (payment deferral agreement) service, where only a portion of the payment amount is paid and the rest is carried over to the next month when using a credit card. While revolving reduces the immediate payment burden, it can lead to a vicious cycle of debt because interest accumulates very rapidly.

As an alternative, the use of debit cards was suggested. Since debit cards are used within the balance available in one's own account, they not only increase awareness of spending but are also advantageous in terms of credit management. In particular, it was mentioned that using a single card rather than using too many credit cards can actually help improve credit scores. Conversely, a warning was issued that credit cards involve using money not yet possessed, which can lead to indiscriminate spending and become a large burden later.

Free debt adjustment consultation and linked support with court systems

The CCRS strongly recommended seeking help for those feeling psychological pressure due to debt. The CCRS clarified that debt adjustment consultation and related services are provided free of charge. This is because it is a public service aimed at economic stability. The video emphasized that there are helping hands in the world, so one should not hide problems but seek solutions with an open mind.

In addition to the CCRS debt adjustment, systems such as individual rehabilitation or bankruptcy through the courts exist. Even if a situation is very urgent and legal procedures must be taken, it may be advantageous to visit the CCRS first. This is because a system is in place where consultation materials or related data prepared by the CCRS can be delivered directly to the court, reducing the costs and inconvenience that occur when an individual deals with the court directly. While court procedures may incur costs, the CCRS consultation service is operated for free.

A CCRS official emphasized, "The systems of the CCRS, which was established to help those experiencing economic difficulties following the 2002 IMF financial crisis, are still unknown to many people." The official stressed that when debt problems arise, it is important to seek solutions through consultation (1600-5500 without an area code) rather than hiding them.

Source: original video (YouTube)