How can a Debt Management Plan help me?

On December 16, 2009, in News, by Lewis Alexander

How can a Debt Management Plan help me?

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During the course of our business day, we receive a lot of questions from prospective clients about debt management, how we can help them, how much it costs and the best debt soltuin for them to follow.

As you can imagine, all situations are slightly different and we specialise in helping people from all walks of life, you could be a single parent with a low paying job or even a footballer.  Yes, even they get into these kinds of financial situations and need help with their debt problems. They are fully aware of the quality help a debt management plan can give them should it be needed.

  • We have listed a few of the questions below,

One of those often asked questions is – How can a Debt Management Plan help me?

Debt Management Plans can help you if you are struggling and unable to repay consumer debts such as personal loans, credit cards, store cards, bank overdrafts and catalogues etc.  If your income is lower than your outgoings, this will cause you to get further into debt each month.

A Debt Management Company will gather all the information from you regarding all your unsecured debts, your income from wages and any other means including state benefits and then decide with you, how much you are able to repay as one monthly sum to start the pathway to reducing the total indebtedness over time.  One, new and affordable simple monthly payment is arrived at with the client to ensure they are comfortable with meeting that payment.

  • The Debt Management Company will then negotiate with the various creditors as to the amount they will each receive monthly.

As you can imagine this involves a fair amount of work and negotiation with the various creditors.

One of the most common types of feedback we receive is that clients are so thankful that we make this process as pain free as possible and we manage to arrange a new debt repayment plan without the clients having to even write one letter.

It is possible to arrange all this yourself, but imagine just for a moment how much time energy and cost would be involved in the process if you were trying to deal directly with your creditors.

  • A client who is already in financial trouble is less likely to be able to cope with such situations as well as trying to negotiate the best terms possible.

Yes, it’s true that a debt management plan will cost you a small amount each month, payable as part of the payment plan and usually included within your monthly payment but the cost is negligible when you consider the many aspects involved in arranging a structured repayment plan yourself.

  • One needs to peek into the management side of a plan to see what is involved and appreciate the complex negotiations a reputable debt management company undertakes on behalf of a client.

Once a sensible monthly payment is agreed, the debt help provider will normally distribute your payments monthly on your behalf to your creditors on a pro-rata basis, minus the costs of the plan.

  • A second question we receive is;

Do I need to pay any legal fees and Do I need to put my property up as security?

The answer to that question is NO in both cases!

A Debt Management Plan is not a legally binding agreement and therefore no legal fees are involved.  If you have a property, this will not be needed for security when entering into an informal debt management plan.

What you will also find is that once a fair payment plan is arrived at, most creditors are very flexible in their attitude towards a debtor.  This is very probably due to the fact that many lenders or loan companies look at it with the attitude that the person involved has taken the positive steps to approach a Debt Management Company and made efforts to re negotiate their debts.

  • This is a very positive move!

They can also be very flexible depending on your track record of repayments.

You must bear in mind that under normal circumstances, debt management plans usually do not deal with but do take into account any secured loans such as mortgages or court fines and any tax arrears. These debts are normally budgeted for within your expenditure part of debt management plans financial statement.

For impartial advice on how a Debt Management Plan can help you right now, contact Lewis Alexander and ask to speak to a personal debt counsellor for free advice.

Professional debt companies like Lewis Alexander understand what people are going through and are willing to offer assistance that allows you to cope in these difficult circumstances.  We will help you review all your finances in private and make a suggestion for a positive solution.

Lewis Alexander Financial Management, offer a first class personal Debt Management Servicenationwide throughout the UK. We are based in Trafford Park, Manchester and we have helped thousands of people in our history.

We have in house specialists who concentrate on debt management and personal debt and loan consolidation and we have been looking after a great number of our clients for many years now.

Call Lewis Alexander on their personal debt helpline using 0800 018 6868, our lines are open 24 hours a day, 7 days a week and your call is free.

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