Can’t see a way to pay off your debt? Do you want to be living a debt free life? A debt management plan can be a great debt solution. It is an informal arrangement that avoids the need for formal insolvency procedures such as an IVA or bankruptcy. With a debt management plan you agree to repay your debt over a period of time, usually extending the amount of time which the debts must be repaid. Your repayments can be reduced to a much more affordable amount making it easier for you to get your life back on track.
What’s great about a debt management plan is that you will be working with experts in helping people get out of debt. Debt management companies will assess your individual situation and tailor make a solution to help you overcome your financial difficulties. You can also rely on support and advice throughout the duration of the plan.
When working with a debt management company they can deal with all correspondence from your creditors so you do not have to worry about being constantly hassled. Debt management companies can even negotiate with your creditors to get them to agree to lower repayments and have the interest on your debt frozen. However, please remember that your creditors do not have to accept this.
Before you consider a debt management plan remember that they can take a long time to complete. Also bear in mind that while the plan can reduce your monthly repayments to make them more affordable to you it usually means that you will pay more in total over a much longer period. In some instances if you organise a debt programme this may show up on your credit reference file, which could affect you in the future. However, once your debts have been cleared then your credit rating will start to improve which will increase your chances of future borrowing