Advantages of a Debt Management Plan

Advantages of a Debt Management Plan

Debt management plans are designed especially for those struggling to meet escalating debt repayments. By getting in touch with your creditors, the debt management company will request that your payments will be lowered to an affordable monthly rate.

If you’re considering a debt management plan, you need to know all the details of what it will entail. Here, we have put together a list of the advantages of taking out a debt management plan:

Free financial consultation
You can receive a free financial consultation where the debt management company will discuss your financial situation in detail to find which solution is the most suitable for you.

Reduce your debts in an affordable way
With the help of a debt management company, you will be able to move multiple debts into manageable and affordable payments. With your consent, the payment can be set on a specific date each month, most suitable to you.

Freeze your interest and charges
Although this isn’t guaranteed with all debt management plans, it is possible to set a repayment plan that isn’t subject to change, either interest or non-payment charges. With this in place, you will be able to maintain your payments without the risk of facing further charges on top of your set schedule.

You no longer deal with creditors
Once you have decided to take a debt management plan, you won’t have to deal with any of your creditors. The debt management company will do all the running for you and make all your enquiries to the creditors. They will even write and post all the letters to the creditors – making your role much easier.

Payment plan that you can stick to
Every month you will only have one simple payment to one creditor – the debt management company. This will make keeping up with your payments a lot easier as you won’t have to juggle different payment dates, rising charges and multiple creditors.

Frequent re-evaluation of your payment plan
Many debt management companies can set up a re-evaluation programme, if you struggle to make the new payments. You can arrange for a meeting every 6 months to re-assess the payment plan and ensure you’re able to meet each payment. If not, you can arrange to change or reduce your monthly repayments, with permission of course.

One payment a month
With only one payment required every month, you’ll find it far easier to maintain your payments. Struggling to keep your mounting debts in order will be a thing of the past – the debt management plan will do all of the hard work for you.

Catherine Hubbard is a debt advisor who is currently researching debt management plan.