Business & Finance Loans

Debt ManagementBetter Way To Get Rid Of Debts

Debts are always a cause of worry. Everyone wants to be free of debts but life is mostly unpredictable and you may anytime come across a situation where your debts instead of getting eliminated, starts soaring. In such awkward situations, debt management comes into picture. In simple words it is a plan devised to repay your debts as soon as possible.

According to surveys, 92% of the monthly installment is paid as interest while only the remaining 8% goes towards the actual debt. This justifies the need of debt management. To live life luxuriously, many people spend extravagantly but latter finds very difficult to get rid of the debts. Here debt management plays a vital role.

Approaching a debt management company in the above mentioned situations is a wiser option than opting for debt consolidation. Debt management does not mean another loan rather the company will take a single fixed monthly installment and repay your existing loans. The company will study your income and inevitable expenses and then decide the monthly installment so that you live a normal life.

The debt management company can manage debts between 3000 and 250000. Normally the charge for adopting debt management plan is nil but sometimes the companies may charge you 15% to 17% of the monthly payment as a start up fee or monthly management fee. The repayment period may vary from few months to years depending on the repaying capability of the customer.

Debt management has many advantages. The biggest advantage is that your debts do not increase as the charges and interests are often fixed. Moreover the company of whom you are the client will deal with all your previous creditors, thus reinstating your peace of mind. The debt management plan does not comprise secured debt and such plans cant be discontinued at your own will. The only disadvantage of such plans is that they are not legally binding, so the creditors might take action against you. But this situation can easily be dealt with.

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