Who Are The Best Debt Management Companies?

If you’re in debt, which companies can help you?

For those struggling with debt, exploring the different debt management solutions is critical. Addressing debt sooner, rather than later, will be beneficial in the long run, no matter how daunting it can be at first.

There are different options available depending on the amount of debt and other factors, such as assets and employment status. Each debt case is different; not everyone will need to go down the same route, so seeking advice from a debt advisor before choosing an option is advisable.

Bankruptcy should always be the last option. Choosing an Individual Voluntary Arrangement (IVA) or a Debt Management Plan (DMP) is a better solution than bankruptcy.

Debt problems in the UK are on the rise. Insolvency is increasing at a concerning level. In 2017, the number of people with IVAs increased 20% from the previous year. Company insolvencies also increased, with over 17,000 companies going out of business.

If you find yourself struggling with debt, find a plan that is right for you. If you decide that a DMP is the best solution for your debts, this can be handled and managed by a professional. But, finding the best debt management company for your case is essential.

Since the Financial Conduct Authority (FCA) took over regulating debt firms in 2014, many have gone out of business. This is because they were not upfront with clients and would use unethical marketing techniques against vulnerable people in debt. The FCA now has stringent regulations in place and only those who follow the guidelines will be on the approved register.

Why Choose a Debt Management Company?

There are a number of charities that can help people when they are in debt and offer free advice. The new FCA regulations mean companies are legally obliged to tell consumers that this is an option.

Yet, despite the free option, many choose to use a debt management company to help them handle their debts. This is because a company may be able to negotiate better with creditors. For some people, having somebody else deal with the creditors is less stressful. Debt companies already have communication and relationships with lenders which can help when organising a DMP.

Finding The Best Debt Management Companies

The best debt management companies will be the following:

Authorised by the FCA

It’s imperative to find a company that is listed on the Financial Services Register. This means that they are authorised by the FCA to manage your debt and have a customer-focused approach, rather than profit.

A Member of a Trade Association

There are a number of trade associations who audit debt firms and ensure they follow a certain code of practice. If they are a member, this is an extra piece of reassurance that they are monitored and adhere to guidelines. Debt Managers Standards Association (DEMSA) is the main trade association, and Debt Resolution Forum (DRF) is another.

A Company You Trust

Whether they are recommended by a friend or a family-run business who you know, make sure you feel comfortable and trust the firm to handle your debt. You will be with them for a number of years, so you’ll want to feel comfortable.

Debt Management Software is Used by the Best Debt Management Companies

Each case for a DMP or IVA requires a great deal of accurate information about each individual’s credit history. When a plan is set up, monthly repayments by the individual will need to be monitored and sent accordingly to each creditor.

Keeping all of this vital information in one easy-to-access location is essential. LogiDebt is the debt management software from Logican which enables debt firms to handle each case accordingly. It enables companies to automate and manage payments effectively, as well as automating communication.

To further help those in the debt industry, Logican has recently partnered with Experian to create a credit report accessible to DMCs and insolvency practitioners. This credit report allows companies to quickly learn the credit history of clients. The results are accurate and comprehensive, making it easier for companies to see where their client has debt.

If you are struggling with debt, seek help from a professional who can offer guidance about the next steps to take. You’re not alone and, with the right debt plan, you could be out of debt much quicker than you first thought.

Logican creates debt management software for the best debt management firms in the UK. If your business could benefit from efficient software to streamline processes, contact us for a free demo.