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Posts Tagged ‘debt management’

Individual Voluntary Arrangements (IVA’s) are becoming an increasingly popular method in which to ease any debt problems. Recent figures suggest that the amount of IVA’s taken out each month now exceeds that of the amount of bankruptcies. However, IVA’s are not always the best debt management solution for some, and there are some advantages and disadvantages which you would have to consider before applying for an IVA.

One of the biggest advantages of an IVA is that they are private; none of your friends or family has to find out. This means there is no social stigma attached to IVA’s. Furthermore, an IVA leaves you debt free in up to five years whilst safeguarding all your assets at the same time. Even during these five years, the repayments that you make are within your means. You are never asked to repay more than you are able to.

Perhaps one of the most stressing aspects of debt problems is having your creditors continually threatening you for your payments. Luckily, an IVA ensures that creditors are unable to contact you, make any demands or take you to court.
For some people, the IVA period of five years is a long time to be repaying debts, and filing for bankruptcy gives you the option of being debt free in as little as a year. Although an IVA is not publicised in the same way as bankruptcy, you can still find a record of your IVA on the Individual Insolvency Register, which is searchable by the public. In addition to these disadvantages, the life of a debtor in an IVA period is highly monitored during an IVA period, with wage slips and salaries checked regularly to ensure that you are repaying the highest amount possible.

If you are seriously considering an IVA, be sure to do a thorough check of the Debt Management comany before you choose. Debt Free Direct discovered several agencies were giving consumers misleading advice on IVA terms, so it is always advisable do your research first.

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When most people think about debt they automatically think that it’s bad, but debt doesn’t have to be bad. In fact, if you’re good at managing your money, it could even be a good thing and could even possibly make you money. I’ll explain how that can happen.

The first thing I should say is that these tips are mainly for people who are without debt currently, to show how to use debt as a good thing. If you do have debt already, the best tip is to pay it off, if possible, with savings because the interest rate on the debt is most likely a lot higher than what you're getting for your savings; also consider transferring credit card debts to one with a low, or interest free, introductory rate of interest, so that you're paying less in interest.

There are almost always credit cards offering interest free periods – these can sometimes be up to, or even over, a year - for purchases, because they hope you'll max it out and then at the end of the period they can charge you a fortune in interest. However, if you're clever and resist the temptation to overspend you could take one of these cards out and use it for your normal spending, putting the money you would have been spending into a savings account, then at the end of the period you will pay off the card and then cancel it, keeping the interest from the savings for yourself.

Another way debt can be beneficial is if you incur it on a cash back credit card. These cards give you a small percentage of cash back on all transactions you spend on them, so provided you pay off the card each month, you can actually make money out of this debt!

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Debt awareness

Debt management program is a rational and practical way of managing debts effectively. You get rid of your pile of debts easily. When all you creditors agree with this management program, you are required to make a monthly payment to the solution provider who distributes the amount regularly to your creditors. In this way debt payments are ensured.

However, first of all, take the stock of your financial upkeeps. Note down what the liabilities you have remaining to make now. Start cash transaction instead of using various credit cards. If you are unable to do so then do not hesitate to seek advice of a credit counselor. However, the counselor’s advice often put stress on debt consolidation loans. These loans offer a solution to combine all of your existing debts into a single loan entity. This is indeed a good management program since one loan is always better than paying for several loans separately.

In due course, most of debt management programs charge a nominal monthly fee to cover the administrative expenses. Make sure the agency may not any maintenance fees in addition to monthly fees. So avoid paying an outrageous upfront fee.

You can make application for debt management program online as well as offline. Of that online processing is preferred. But if you are worried about giving your sensitive information on the net then you can take heart in the fact that most of these sites have a distinct encryption system in place that makes sure that the information you give remains protected.

So you can manage your multiple debts effectively. The debt management program may suggest you the right way to make debt management affordable. It helps you to wipe out your debts which in turn enable you to stabilize your financial condition. Eventually you secure a debt-free life.

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