Debt management: should I ‘go it alone’?

Debt management is a process that involves talking to unsecured lenders, asking them to consider ways of helping the borrower repay money in an affordable, sustainable manner. They might, for example, agree to accept lower monthly payments, freeze interest and / or waive charges.

There are two basic ways of doing this. You can contact your lenders yourself or you can talk to a professional debt management company about doing it on your behalf. There’s no ‘right’ and ‘wrong’ decision; it’s a question of personal preference.

If you can’t keep up with your debts, debt management could be the right debt solution for you. So, should you ‘go it alone’ or ask for professional help?

Debt management – the professional approach

Many people approach a professional debt management organisation when their debts become too much for them. Many organisations will charge a fee for this, but there are advantages to having professionals managing your debts. For example:

• They know how debt works. They know the rules about different kinds of debt, and they know what kind of suggestions lenders are likely to accept / reject.
• They can cope with the complexity. It isn’t always easy, managing multiple debts to multiple lenders, but debt management professionals are used to it – they’re used to the terminology, the negotiations, the paperwork...
• They’re not emotionally involved. Being in debt (and talking about it to lenders) can be an extremely stressful experience for borrowers – but not for debt management professionals who deal with debt every day.

Debt management – the ‘DIY’ approach

Some people, however, prefer to handle it all themselves and save themselves the fee that some debt management organisations charge. As long as they have confidence in their negotiation skills and are prepared to deal with the phone calls and letters, there’s no reason they shouldn’t.

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Tags: debt, management, debt management, unsecured, unsecured debts, debt solution

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