Rising Tide of Debt: Analyzing Surrey’s Growing Need for Debt Management Services in 2023
Debt management services are often companies or institutions that assist individuals with debt management, reduction, or consolidation. They provide a variety of services, such as counselling, financial education, and support in developing debt management programs. These services might be especially useful for those who are trying to pay off various obligations, such as credit card bills, personal loans, and other unsecured debts.
What exactly does a debt management firm do?
Debt management businesses evaluate how much you can afford to pay toward your debts once your living expenses, such as food and home bills, are met. They often handle payments to creditors on your behalf while keeping track of what you have previously paid and what you still owe.
The figures from StepChange Debt Charity’s monthly client data reports of July 2023 give vital insights into debt management services in Surrey. 14,855 consumers received comprehensive debt counsel, a total of 8% increase from July 2022. The number of clients reporting a cost of living increase as their primary cause for debt decreased somewhat to 25%, that is one in every four clients. The number of customers who are behind on their gas, dual fuel, and electricity payments has decreased somewhat.
The above statistics demonstrate the increased need for debt management services in Surrey, with a substantial number of people seeking assistance due to rising living costs and other financial difficulties.
Debt Management Services in Vancouver and Surrey
Here are some key aspects of debt management services
Debt Counseling
Debt management starts with counseling. A counselor will review your financial situation, including your income, expenses, and debts, to provide personalized advice on how to manage your debt.
Debt Management Plans (DMPs)
Many debt management services in Vancouver and Surrey offer to set up a debt management plan. This involves the agency negotiating with creditors to lower interest rates or waive certain fees. You need to make a single monthly payment for the debt management service, which distributes the funds to your creditors.
Financial Education
The primary duty of these services includes educational resources to help clients understand budgeting, saving, and responsible credit use. This aims to help individuals avoid future debt problems.
Service Fees
Some debt management services charge fees for their services, while non-profit organizations offer services for free or at a reduced cost.
Impact on Credit Score
Participating in a debt management plan can impact your credit score. While it may initially lower your score, consistent on-time payments can improve your credit over time.
Alternatives
Besides debt management plans, there are other options for dealing with debt, such as debt consolidation loans, debt settlement, or, as a last resort, bankruptcy.
Conclusion
It is essential to research and choose a reputable debt management service, ideally one that is accredited by a recognized body like Debt Consolidation to avail debt management services in Surrey. Always be wary of organizations that make unrealistic promises or charge high fees.