It is easy for debt to get the better of you, but there is help at hand. A debt management is one option that is available to those who are in debt, but is it the right solution for you? There are many factors to consider before entering into any kind of financial agreement. A debt management plan can help make managing everyday finances a lot easier, so it is worth finding out more about whether debt management is right for you?
What is debt management?
A debt management plan is a scheme that helps you to pay off multiple unsecured debts at a rate that you can afford. Experts will negotiate with your creditors to extend the amount of time that you can pay off what you owe to them. This makes monthly payments smaller and more manageable so you should be left with more monthly outgoings. Well established debt negotiators will have good relationships with lenders, and may be able to negotiate a reduction or suspension of interest and charges, although this is entirely up to the creditors and is not guaranteed.
Do I need debt management?
There are several factors to consider before entering into a debt management agreement. Make sure you speak to debt professionals before entering into any kind of agreement.
Here are a few things that you should look out for…Are you struggling to make payments to your creditors?
If you are missing payments then it may be time to enquire about a debt management plan. It is no use to your creditors if you cannot pay the bills, which is why it is often in their interest if you enter into some sort of agreement that results in you being able to make reduced payments on time every month. A debt management company will negotiate with your creditors on your behalf, explaining your circumstances to them. They will seek longer repayment terms that can divide your debt into smaller bite size pieces, making it much more likely that you can pay it.
You will have to detail your income and outgoings so that the interested parties can see what you can realistically afford. This is a simple task; and will give confidence to you and your creditors that the debt management plan will work!
Do you have multiple debts?
If the answer to that question is ‘no’, you should consider other ways to clear your debts. A debt management plan will always involve managing more than one unsecured debt. An unsecured debt usually takes the form of a bank loan, credit card, store card or payday loan. If you have more than one of these kinds of debt, a plan can be formulated that puts all these debts into one payment creating simplicity.
Are you working, but it still struggling to pay the bills?
It can be so frustrating when you struggle to make payments, despite working for a living. A debt management plan can help you manage finances more easily. If you are unemployed, there may be better options available to you; make sure you ask a specialist as soon as possible to find out what you can do to clear your debt, no matter what your circumstances may be. Do not be afraid to admit that you need help managing debt.