Debt Management Programmes
Individuals that have a relatively small amount of debt (i.e. under £20,000) may benefit from a Debt Management programme. If you are struggling to maintain your monthly credit repayments, and wish to consolidate your debts without the need for a loan, debt management may be the way forward. A representative from the debt management company will contact your all of your creditors, and propose an informal arrangement between you.
They then negotiate reduced monthly payments, and will also try to freeze the interest on your accounts. You then pay just one monthly payment to the debt management company, and they deal will all your creditors. This frees you from the stress of being constantly pursued by your creditors.
There are some negative aspects of Debt Management, however. The agreement between you and your creditors is an informal one, and as such can be cancelled by any one of your creditors at any time – it is not legally protected as with an IVA or Trust Deed. However, IVAs and Trust Deeds are only usually available to individuals with a large amount of debt (over £15,000), so if you have debts of less than £15,000, this may be your best option.