Debt Management Plan Pros and Cons
Advantages
You do not have to do any work in relation to your debts, for example, drafting letters to creditors
There is only one payment to make - to the Debt Management Organisation - and the company distributes the money to the creditors.
You do not have to pay several different companies. Instead only one payment.
If the plan is carried out successfully all Interest and charges are usually stopped.
You only pay what you want to so that you have enough left over for a healthy social life.
You will no longer need to speak to your creditors in order for debt elimination to take place
Disadvantages
A lot of debt information is needed.
Debt Management Plans have no legal standing.
If your monthly payment is low and your debts are high them you will most likely be in a plan for the rest of your life.
Other types of debt that are not included are:
Secured loans
Leases (property)
Hire purchase
CSA / Maintenance arrears
Car loans (if secured against the car)
Rent
Council Tax arrears
Student Loan repayments.
© 2009 Hamilton and Clarke Ltd.
Clear Insolvency is trading name of Hamilton and Clarke Ltd.
