Debt Management Companies

Anyone who finds themselves insolvent with mounting unsecured debt will find that there are numerous options available to help get them back on their feet. As such, there are many companies that are available to help individuals make the best choice depending on their circumstances. But with so many companies now advertising their services, it is a minefield as to which one to choose. Rather than just go with the first that comes up, there are a few considerations an individual should make.

There are 2 types of company that can assist with debt problems; Charitable and fee charging.

Charitable Debt Management Services

There are a number of popular charitable organisations that offer free help and support to individuals facing a debt crisis. National Debtline, the Citizens Advice Bureau (CAB) and Consumer Credit Counselling Service (CCCS) to name a few. They will be able to help discuss the best options available, often in one to one meetings. As they are charitable organisations, there is no fee for the service, though as more people are finding themselves in financial difficulties, these companies are becoming backlogged with cases and new enquiries may take a very long time to be processed with little ongoing support.

Fee Charging Debt Management Services

A lot of the companies that advertise their services will charge a fee. However, they are often able to deal with cases far more efficiently and deal with any complications quickly. Companies may offer a free consultation to give an individual advice and to establish the most suitable option. Should an individual wish to proceed with the company, then a fee may be built into the monthly repayments calculated. The amount can vary but 15%-20% of the monthly payment is typical. While it may seem a lot, Debt Management Companies are specialised in their field and could be able to agree a better rate with creditors, often arranging for interest charges to be frozen, therefore the fee could actually be worthwhile, especially as there will be always someone to talk to in the event of an issue.

Research

It is important for anyone seeking advice on solving debt problems to do their research and find a company that they are completely happy with. It may be possible to get feedback from others that have used some companies. Furthermore, if an individual does take up an offer for a free consultation, there should never be any obligation to continue with their services.

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