What is the difference between a Debt Management Plan and a Debt Consolidation Loan?
A Debt Management Plan and a Debt Consolidation loan do a similar thing, they both offer you one single payment to make to your unsecured creditors. A debt consolidation loan means that you will have to take out a loan to pay off your creditors. A debt management plan does not require any further borrowing, as One Advice will negotiate with your creditors so that they accept a lower payment to your debts.
Debt management and debt consolidation loans both are two different way to pay off debts in easily. Debt management plan allow you consolidate your entire debts into one. You may also hire a service provider for this purpose. Then you will need to submit a fixed monthly installment to the service provider and that party will redistribute that amount accordingly to your creditor where as debt consolidation is a loan option where your service provider will repay entire debts. Further you will have a single creditor where you can repay the amount at flexible repayment terms. There will be longer repayment period. However, both these plans are designed to manage with more than two or three debts. If you have several debts then you should go for debt management plan for easy repayment of debts.
