Getting To Grips With A Debt Management Program

 
A debt management program is the ongoing agreement between someone who owes money and their creditors.
 
Some debt solutions can run for several years – the key is a lender expects the money someone owes them to be repaid in a reasonable time.
 
The length of time that is reasonable depends on the financial circumstances of the person owing the money and the total amount of the debt.
 
For instance, someone owing £10,000 with a disposable income of around £850 should be able to repay the debt in around 10 years – but someone with a £200 disposable income has no chance of repaying that amount so quickly.
 
Generally, a reasonable time is taken to mean around 10 years.
 
Over such a long time, everyone\\\\'s personal and financial circumstances will change. They may lose a job, gain promotion or perhaps suffer a relationship breakdown that leads to separation or divorce.
 
Debt Management Program
 
All these factors affect someone\\\\'s ability to repay their debts, which is why regular reviews are built in to any debt management program.
 
The default review time is around 12 months, but is often shorter, especially if illness or redundancy are involved. 
 
The review ensures someone\\\\'s debts are repaid as quickly as possible by allocating disposable cash fairly among creditors. Agreeing a program does not mean debts are written off or reduced, although some lenders may freeze interest and charges on an account.
 
Each review means putting together a detailed budget of the debtor\\\\\\'s income and expenses. Taking expenses away from money coming in shows how much disposable income is available to repay debts.
 
Do not forget debt management is not a way to avoid repaying any money owed to creditors, but a method of settling a debt without forcing someone in to undue financial difficulties.
 
Someone struggling to pay their bills should consider talking to an independent adviser who can discuss the options available under a debt management program.

 

Client Testimonials
  • We were put in touch with Pathfinder by a friend of ours when a failed business created alot of personal debt of which we had no way of being able to continue with the payments . It seemed like a jungle with no way out . Dawn Speakman of Pathfinder...
  • After drowning in debt and not knowing which way to turn I was put in touch with Pathfinder DM, through their help and guidance I am now slowly getting this under control and myself back on track, the staff at Pathfinder have been professional...
  • In early 2009, I read an article in the Salford Advertiser, for Pathfinder, a debt management company. At the time I had run up debts of 50K on various credit cards, mainly through changing jobs, along with a reduction in salary.I arranged a meeting...