Looking for good debt consolidation loan quotes?

Debt consolidation loans – a solution to your debt problem?

It’s all too easy for debt to mount up and then, for lots of different reasons, people can find themselves struggling to keep up the repayments. Redundancy, illness and reduced hours can make a real impact on your financial situation and leave you facing the pressure of creditors chasing money.

A debt consolidation loan could be the solution. With a debt consolidation loan, you combine all your existing debts into one affordable monthly payment.

So rather than having to find the money for different credit cards, store card or other loans each month, you just have one monthly payment to make.

Debt Consolidation vs Debt Management

What is the difference between debt management and debt consolidation?

What are the positives and negatives of both?

Which is best for me, debt management or debt consolidation?

What are the positives and negatives of both?

Which is best for me, debt management or debt consolidation?

Debt management is where someone may be struggling with various credit cards, overdrafts, loans, etc and can no longer service the debts in accord with what the accounts or their creditors are asking for payments each month. So the debtor, seeks help and assistance via some other form of repayment, usually through a third party, in managing the debts through alternative means.

This assistance can be in the form of a debt management plan, or possibly an IVA/Individual Voluntary Arrangement.

Debt consolidation is where someone may take out a loan to consolidate, or pay off the smaller loans and credit cards they may have. This gives them one monthly payment, and in some instances a lower monthly payment, than what they had previously been paying to the smaller multiple accounts.

There are positives and negatives to both these ways of getting out of debt.

Any form of debt management, be it a DMP/debt management plan, or an IVA, has an affect on your credit. In most instances you would need to be struggling with the debts in order to place the debts/accounts in any form of debt management. So your credit may have been impacted already. But if you are seeking assistance through debt management it usually means your credit and credit rating, is going to be affected.

Debt consolidation does not need to affect your credit in a negative manner and for some it may improve their credit by consolidating many accounts into just one account.

Both, debt management and debt consolidation allows you to make one monthly payment instead of multiple payments. With debt management the monthly payment is based on what you can afford and again impacts your credit. In debt consolidation the monthly payment can be less than what you previously had been paying to the multiple accounts, and it doesn’t have a negative mark on your credit.

So which option is best for you?? That depends on your situation and circumstance.

If you are currently in arrears with the credit cards and accounts/loans you have and have experienced a major change in your finances, hours cut at work, made redundant, etc, then debt management may be a stronger option for you.

If you are just looking to reduce your monthly outgoings and want to budget a bit better, then a consolidation loan may be a better option for you.

If your credit is already showing late payments and defaults, then a form of debt management may be the way to go.

If you are concerned about your credit rating and want to maintain it, then debt consolidation is what you may want to look more into.

So obviously it is best to get professional advice, speak to an adviser and have them review your full situation and help you in finding the best solution for you.