News Debt Management Plans - Pro's And Con's Of Debt...

Debt Management Plans – Pro's And Con's Of Debt Management Plans.

-

Debt management plans are among the most best-selling debt elimination alternatives, this doesn’t necessarily imply they’re the most beneficial choice for your particular situation. The companies that provide these types plans are consumer credit advising services and they are available in Varity and quality.

When you first make contact with the advising office, they should at the start supply you with a counseling session to analyze your fiscal situation and, if necessary, suggest an Debt Management Plan. If your happy and agree to sign on, they’ll attempt to stop late fees and negotiate a lower rate of interest with all your current creditors. You’ll pay them a monthly payment and they’ll split up that payment to your creditors and make your monthly payments. Even so, as with any debt reduction plan, these programs have their own pros and cons.

The Pro’s of Debt Management Plans…

>>>Your monthly payments remain the same…Unless yourself or the counseling company miss or make your payment late, you do not have to be concerned about your payment increasing.

>>>It will be necessary to close your credit card accounts… It’s mandatory to stop using any credit cards. You may not see this as a good thing, but it’s certainly beneficial and it does make good sense.

>>>A few of your creditors might be able to stop late fees and give you the lower interest rate.

>>>You won’t have the inconvenience of paying a whole bunch of bills monthly. While its extremely crucial that you go over your balances in your statements monthly.

The Con’s of Debt Management Plans…

>>>These plans are not for everyone. These type of programs are mainly for the consumer who has sufficient regular income each month to pay their debt management plan and pay for other monthly expenses…without having to use credit cards! It’s to your advantage to setup a savings account for emergencies.

>>>Very inflexible re-payment schedule…You’re not able to miss a monthly payment or pay less monthly. Even if you have an fiscal emergency. Consequently these type of programs have a very high failure rate.

>>>Your credit rating could be affected…Although these companies will not report this to the credit agencies, there’s not any way to prevent your creditors from reporting that your making monthly payments by a debt managing plan.

>>>These plans are for unsecured debts only…If you owe money for taxes, alimony, or child support, automobile, house mortgage or any other secured debts this type of plan cannot help.

>>> Fraud…While most of these companies are genuine and really want to help the consumer, there are many that are misleading and dishonest.

>>>A few companies make late payments, consequently your account could get charged with late fees and a higher rate of interest .

>>>You need to do your research and ask them a lot of questions… Try to get some references from them. All this work will be worth it if you believe a debt management plan is right for you.

These are the most important pros and cons of these type of plans. It’s critical that you do your own research and be well informed prior to signing up for a Debt Management Plan. All the same, you can certainly make your own plan. All you’ll need is a system, a lot of discipline and determination, and for a small fraction of what you’d pay a counseling agency you will be able to buy a do it yourself debt reduction system.

More Resources…

Debt Collecting – What Can You Expect From Them?

In Credit Card Debt – What Happens If You Don’t Pay?

How to Pay Off Your Credit Card Debt.

How To Eliminate Credit Card Debt Without Paying!

Tips On How To Pay Off Credit Card Debt!

Debt Management Plans – Pro's And Con's Of Debt Management Plans.
General Contributor
Janice is a writer from Chicago, IL. She created the "simple living as told by me" newsletter with more than 12,000 subscribers about Living Better and is a founder of Seekyt.

Latest news

Japanese Owl Meaning and Symbolism

If you're wondering about the Japanese owl meaning and symbolism in Asian cultures, the Owl, along with Maneki Neko...

What Are the Signs of Depression in Women

Gender and depression have long been the scope of research in the field of emotional disorders; most authors believe...

Top 7 Superfoods for Men to Stay Young

Superfoods are generally regarded as targeted foods that provide the maximum nutritional benefit - thus these foods are nutritionally-dense...

Best Brain foods for Kids – Boost Brain Power and Keep Sharp

A child's brain is developing rapidly and if you want them to improve their performance in school and their...

7 of the Best Brain Foods for Studying

The foods that you eat can improve the functioning of your brain. Just like drugs, foods have amino acids,...

B12 Shots for Dogs – 10 Key Benefits

The end of 2010, my little dog -- a 7-pound Papillon -- became very stressed after a flood in...

Must read

How Clomid Became a Fertility Drug

Clomid is a popular fertility drug that has...

Consider A Food Career: Find Food Jobs In Washington

Despite our economy taking a downturn, there is...
- Advertisement -

You might also likeRELATED
Recommended to you