For people who can`t make their monthly debt repayments, a debt management plan can offer a real `lifeline`, making their debt manageable again and giving them a much clearer idea of when they`ll be debt-free.
A professional debt adviser can help you to figure out whether debt management is right for you - but first, here`s an online debt management guide, to help you decide if you want to find out more about debt management.
A debt management plan is an informal arrangement in which you will make lower monthly payments to your lenders over a longer period of time than initially agreed.
These reduced monthly payments can make your debts manageable again, though you should be aware that repaying your debts over a longer period of time could also mean paying interest for longer, and therefore paying more in the long run.
However, it is sometimes possible to negotiate a freeze or a reduction in interest and other charges, which can prevent your debt from continuing to grow.
A debt management plan can be arranged on your own, but because of the time and effort involved, many people prefer to let a professional debt management company do the hard work. They can negotiate with lenders on your behalf, and act as a point of contact between you and your lenders for the duration of the debt management plan.
This can vary from person to person. In general, debt management is best for people who cannot afford their existing debt repayments, but feel they would be able to repay their debts in full over a longer period of time and in smaller instalments.
If you don`t think a debt management plan will make enough of a difference to your ability to repay your debts - or if your debts are simply too big to ever pay back within a reasonable timeframe - you may want to consider another debt solution.
Debt management isn`t an option for people who are staying on top of their debts - lenders will only agree to accept changes to your repayment plans if you genuinely can`t afford to make your monthly payments as they stand. Even then, lenders aren`t actually obliged to accept any changes to the way you`re repaying your debts.
If you fail to keep up with your repayments as you originally agreed - whether or not you enter a debt management plan - this can show up on your credit report, potentially making it harder and/or more expensive to obtain further credit for the six years it stays on your report.
Always speak with a professional debt adviser before making any firm decisions. Debt management plans have helped many people over the years, but like any debt solution, they are not for everyone. Taking into consideration your circumstances (such as your level of debt and your income), a debt adviser can help you to establish which debt solution is right for you.
For more information on debt management and how it could help you, click here or call us today on 0800 195 2911.
Answer a few simple questions and we'll give you an instant recommendation on your best way out of debt.
Your privacy is important to us. All correspondence is held in the strictest of confidence and we will only request information required to find your best debt solution.
Tags: debt, management, debt management, debt management online, UK online debt management, guide
Fees payable when continuing service is provided. Repaying debt over a longer period may increase the total amount to be repaid. Calls are recorded and are usually free from UK landlines. Mobile phone users may be charged and should check with their service provider.
Think Money Limited © 2010. All rights reserved. Pennington House, Carolina Way, South Langworthy Road, Salford Quays M50 2ZY. Company Reg No: 04926097. Registered in England and Wales.