Get Rid Of Debt Plans - Information and Advice On Debt Payment Plans

You may have heard of special plans to help people get rid of debt, and indeed there are such things which help thousands of people in the US and UK every year. The process is known as debt management and many specialist companies offer plans and programs to help people deal with serious debt problems.

These 'get rid of debt plans' are used when people get overwhelmed by debts. Such plans can only be used for what are known as unsecured debts, which are debts that are not secured against some asset, such as your house. A mortgage, for example, is a secured debt as it is legally tied to your home, so that cannot be included in a debt management plan. The majority of debts dealt with through these debt plans are for credit cards, but they can include personal loans, store cards, bank overdrafts, catalogue debts, etc.

To take advantage of a debt management plan you need to apply to a professional debt management company, who will put you in touch with a debt advisor to go through your finances with you. They will then be able to provide you with possible solutions to suit your particular circumstances.

A debt plan will involve the debt advisor negotiating with all the people you owe money to on your behalf. Your creditors should all stop chasing you and deal with the debt management company, which can be a huge relief in itself. The aim will be to agree new repayment terms with your creditors, so that you can repay the debts at a rate you can afford. This usually involves interest and other charges being at least frozen, and often reduced. The end result is that you just have to make one, lower monthly payment to the debt advisor, who then passes it on among your creditors.

Using this sort of plan to get rid of debt has the advantage of being an informal arrangement, so if your circumstances should alter, you can make changes to your payments, or even stop the plan and make other arrangements. Using expert negotiators to work on your behalf can be particularly useful if you are not confident about being able to negotiate good deals on your own.

There are charges involved in debt management, but provided you are using a reputable and effective company, these will be more than outweighed by the benefits. The better companies will work with you to produce a financial statement, to get a clear understanding of your precise financial situation. They may even provide assistance and guidance on how to manage your money and budgeting.

To take advantage of these 'get rid of debt plans' you need to have a considerable amount of debt, and a steady source of income, so that you can keep up with the monthly payments. If it is found when you work out your finances that you just don’t have enough money left over to make the payments required, you may be more suited to debt settlement, which involves negotiating for a proportion of your debts to be written off. Debt settlement is common in the US, but in the UK the equivalent plan is an IVA (Individual Voluntary Arrangement), which can write off up to 75% of your debts.

Whichever kind of plan you choose to pursue, it is of the utmost importance to be aware that there are a great many debt management companies that you can approach, but they will not all give you the same result. The problem is that for every reputable and respectable company there is another whose only aim is to take money from those people who can least afford it. You are going to be making regular payments to the debt management company you choose, so it is vital that you can trust them.

So when you come to decide who to approach for a plan to help you get rid of debt, do not search randomly; follow personal recommendations, check that companies are well established and that they have a solid record of having already helped many other people.

Read reviews and recommendations for reputable debt management companies in the UK and US.