If you are struggling with your debt and looking for a way to make your monthly payment easier to manage, both a Debt Consolidation Loan and a Debt Management Plan can do just that.
Both leave you with one low monthly payment. This is a great benefit if you struggle making multiple payments to multiple creditors.
Differences Between Debt Management and Debt Consolidation.
Both of these debt solutions offer a similar promise - you make one payment which will cover all your unsecured debt. But they do it in very different ways:
Debt Consolidation Loan - A Debt Consolidation loan is a loan that you take out to pay off all your other debts. Once they have been cleared, you are left with only the one loan payment to make. Debt Consolidation Loans are often secured against your home, meaning that this type of debt consolidation will offer you a lower interest rate.
Debt Management Plan - This is a repayment plan where a debt management company, like AllClear Finance, will negotiate with your creditors to offer you a lower payment. No matter how many creditors you have or how much debt you owe, all you need to do is make one payment to us which we will distribute between your creditors. You don't take out any further credit with a debt management plan.
What Debt Solution is right for me?
It would be impossible to say which debt solution is right for you without taking a look at your finances first. Please get in touch with one of our expert debt advisors on 0800 048 1762.
Remember that you should never take a debt consolidation loan out if you feel as though you may struggle meeting repayments.