Switching Debt Management Plans Your Questions Answered

What can you do if you’re unhappy about your debt management plan? Many people carry on regardless, putting up with poor service and continuing to receive hassle from their creditors. You don’t have to put up with this situation and shouldn’t. Switching debt management plans can be relatively straightforward process and can offer you a number of important potential benefits. Switching Away From Poor Debt Management Companies It’s no secret that there are many poor quality debt management firms in the UK. Many have failed to invest in providing their staff with knowledge and professional qualifications. Some ask a single member of staff to supervise many hundreds of clients meaning that they have little time to dedicate to your case. Often very little effort is made to negotiate with creditors that haven’t agreed to offers, haven’t offered any concessions on the debt and which may be continuing to hassle you. If your enquiries are being dealt with very slowly or unhelpfully, if your creditors aren’t agreeing to your plan, or if they’re continuing to load on more interest and charges to your debts, the answer may be to switch to a new debt management provider. Would you put up with this level of poor service from any other company that you use? Are You Contractually Tied To Your Existing Debt Management Provider? The answer is that you almost certainly are not restricted contractually from switching away from your existing debt management firm. The FCA’s rules for debt advice firms state clearly that your terms and conditions must explain how you can cancel your contract and the notice period that applies. In some instances it might be as simple as cancelling your payment to them, though you may prefer to give them notice by email or in writing so that they don’t start chasing up payments from you. Debt management plan providers will usually cancel a plan where a client misses a few payments without explanation anyway. What Is The Switching Process? The new provider will want to have an understanding of your circumstances. This will give them the information that they need to work on your behalf, or help them to advise you whether a different type of debt solution might be in your best interests. The information they’ll need will include: Your current income and household expenditure. This is probably information that you’ve given to your previous provider and you may have paperwork from them detailing these figures. Your debts. You may well have a statement from your previous provider with a list of the debts, balances and account numbers. Your assets. Information about things such as home ownership can help a qualified debt adviser to ensure that a debt management plan is the best option for you. If switching to a new debt management plan makes sense they’ll quickly forward the paperwork that you need to begin your new debt plan. Will My Creditors Object If I Switch? There’s usually no reason for your creditors to object to you […]

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Get Your Debt Under Control Some Sensible Options

Being in debt is a dreadful feeling. You work hard all week and the money is out of the bank before it even has a chance to gather a speck of dust. The only way to see the “light at the end of the tunnel” is to find a way to get your debt under control. There are a few avenues to go down, but only you can decide which is best for your particular circumstance. Manage Your Own Debt If you have the discipline, you may be able to get out of this mess on your own. You are going to have to sit down with all of your bills, both credit and household, and figure out exactly how much you need to get through each month. More than likely, you are going to need to cut out a lot of unneeded expenses, such as your weekly night out or ordering so much takeout. When you have your budget in line, you will need to organize all of your debt payments. One method of payment that is sometimes recommended is to pay off your credit cards with the lowest balance first (prioritize in order of highest interest). As each card is paid off, fold that payment into the next card. As you tick off each credit card, the balances will come down quicker and the same amount of money is becoming more and more effective. Debt Management or Debt Consolidation?  If you are unable to manage your debt on your own, two of the options available are debt management and debt consolidation. If you still have decent credit, a debt consolidation loan may enable you to reduce your payments down to one and reduce your interest rates. The monthly payment might also be lower than what you are currently paying. The second option is a debt management plan. This is one step ahead of bankruptcy and might be less damaging to your credit record. It will still be damaged, but necessarily not for as long and as badly as a bankruptcy will hurt it (depending upon circumstances). This also shares the benefit of having a single monthly payment to make managing your money easier. What About Bankruptcy? In some cases, bankruptcy is the only option. If this is your chosen route, it is probably best to immediately get qualified debt advice. They can guide you in the best manner to proceed and may be able to help alleviate the pressure being put on you by creditors. At the very least, it can alleviate the stress you are feeling from that situation. Bankruptcy will usually be on your credit report for six years. Once the bankruptcy and all debt associated with it is removed from your credit report, you’ll be well positioned to steadily improve your credit rating again over time.

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Can I Trust a Debt Management Company?

Many people live with the negative effects of debt for a long time before taking action. It can affect their family life, their working life and their health. Often an event will spark people into action to tackle their debts, for example a strongly-worded debt collection letter threatening legal action. Because the point at which people seek help for debts is often already a stressful moment, some people can let down their guard. For example, if you search online for “get out of debt” you’ll get thousands of search results, many of which are promising you that they’re the best service available. Like with any other industry, debt management companies can be competent or incompetent. They can be good value or ludicrously overpriced. They may follow the regulatory rules which protect you or they may ignore them. Some are trustworthy, others lack integrity. Let’s be honest here.. Even though we work within the world of debt management we acknowledge that the industry as a whole hasn’t got a great reputation. Too many firms have been profiteering at the expense of their clients, promising much and delivering little, or pretending to offer clients advice while in reality they’re merely treating them as a sales prospect. While things are improving, our view still remains that there are debt management companies that you should not trust. How can you identify debt management companies that you can trust? There are a few signals that will help you to identify firms that you can rely upon to provide you with great advice and effective debt solutions. The company should be registered with the Financial Conduct Authority. Is this registration clearly mentioned on the firm’s website? If it isn’t, steer clear. If it is you might still want to verify the registration using the FCA’s consumer credit register tool. While you’re on the firm’s website check a few other things Is there a complaints policy, a privacy policy and a geographic address within the UK where they’re based? If these things are missing it’s almost certainly better to move on and find a more credible firm to trust with such an important and sensitive issue. The website should also reveal whether the firm is a member of the DRF or DEMSA. These are trade associations for debt management firms which audit their members to check compliance with the appropriate rules and regulations. Being a member doesn’t automatically confirm that you should be 100% confident about using them, but it’s certainly a positive sign. If a firm is not a member, you might wish to ask yourself why they haven’t opened themselves up to this scrutiny of their business. Good debt management companies which are worthy of your trust invest in their employees They understand that staff training and qualifications help their businesses to deliver a higher quality of advice. It’s a sign of commitment to providing good advice rather than just maximising their commercial opportunities. Ask any debt adviser you speak with what professional qualifications they […]

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A Guide To Debt Management In The UK

Do you want to repay your unsecured debts but pay an affordable amount each month? A debt management plan may be the appropriate solution. Where appropriate, it reduces monthly payments for unsecured debts so living expenses become more manageable. This allows you to regain control over your debts, making repayment more affordable so life can get back on track. Rather than dreaming about becoming debt-free, consider using a debt management plan to make this a realistic future prospect. Highlights of a debt management plan: • Seek to negotiate lower repayments with unsecured creditors • Remove hassles of creditor negotiation from you • Request that creditors stop interest and other charges • Unsecured debt repayment becomes more affordable for you • Receive personalized and dedicated assistance throughout the process Debt Management Plan Basics When financial difficulties prevent you from maintaining contractual payments to creditors of unsecured debt, a debt management plan makes dealing with your creditors easier. Though you can arrange a debt management plan on your own, having a third party do it might save time and frustration. The provider works to negotiate lower monthly repayments with each of your unsecured creditors. A good provider also uses their expertise and established relationships with those creditors to encourage them to consider suspending interest and other charges. The process begins with one of our representative reviewing your financial situation. By creating a budget and determining how much income remains each month, we help you determine whether a debt management plan is the best solution to your financial issues. This also makes it easier for you to control your spending. Our advice is professional and there is never any obligation to take it. We simply provide recommendations—whether you use them is up to you. Why Choose A Debt Management Plan? If it has become difficult for you to manage your debts, avoid the urge to do nothing. Ignoring the situation will not make the problem go away. It will actually make it worse, especially if you begin to miss payments. Rather than allowing creditors to pressure you into paying more than you can afford, explore a debt management plan. Reducing payments to a feasible level helps rectify the financial situation rather than worsening it. Get Help With Your Debt Today: Fill Out Our Short Form To Get A FREE Debt Assessment. A debt management plan should make debt repayment affordable. With a third party arranging the reduced payment, you are spared the trouble. All debts will be combined into one monthly payment, making financial management easier. Taking the appropriate action to repay debts reduces the risk of becoming subject to legal action from creditors. This might help you to avoid additional damage to the credit rating, not to mention the stigma associated with these processes. Establishing A Debt Management Plan If you owe unaffordable amounts in unsecured debts like credit cards, personal loans, store cards, and bank overdrafts, you may qualify for a debt management plan. This plan is an agreement between a debtor and creditors for a […]

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