The Management of Debt
There are companies that essentially take over your debts, and negotiate repayment terms with your creditors, to fit you.
Some of these companies could be a genuine help to you, some less so. If you are considering approaching a debt management company, check how much of your monthly payment goes to paying your debts, the last thing you need is to be paying significant amounts of month to another company.
Some good companies work free for their clients, getting paid by the people you owe money (creditors). They recieve a percentage of your payment by the creditor for getting the debt paid. Other companies charge monthly fee to you, and a consideration fee of around one month's payment for the debts to be analysed, this reduces the amount of debt you are paying back each month and results in a longer repayment period.
It's also worth reseaching which of your debts should be included. Some, such as student loans, many department store accounts, and payments to I.R.S., cannot be negotiated - adding these to a debt management plan will not change your monthly payments - and if the debt management company is charging you - adding these will simply cost you more.
A good debt management company will conduct a financial review with you to understand your personal circumstances, including what you owe, your outgoings, and agree with you how much you can afford to pay each month.
They then contact your creditors to negotiate a payment plan on your behalf - you make a single monthly payment to that company, they split it across your creditors.
Check how they make their money.
