Most of the people in Singapore have more than one credit card, and these credit cards have separate benefits. Under these circumstances, individuals can fall into a situation like debt trap as they would tend to own money too many creditors at the same time. There are various due dates and payments that one has to keep a record and the continuous reminders from the unsettled balance only result in added tensions.

Delays in the payments after the due dates of clearance of debts, there is only increase in the debts. One such way out of the trap of the debt is getting the personal loan that is denoted as Debt Management Plan. Debt Management Plan was introduced by ABS (Association of Banks Singapore) in the initial part of 2017 for all the nationals of Singapore and the Permanent Residents which happen to face issues in settlement of their debts.

Debt Management Plan is a kind of personal loan where an individual can borrow a large sum of money for paying and clearing of all the current debts instantly. However, the individual can take the assistance of a Debt Management Plan only for the credit facilities that are unsecured like Credit Card Loan Singapore, personal loans, and other credit issues. Here are some benefits and demerits of Debt Management Plan.

An individual has to make single payments only every month as the Debt Management Plan consolidates all the present debts into a single debt. This will assist the individual in saving all the time and energy and remove the stress of missing any payments as the individual does not need to maintain any track of all the creditors.

The interest rates get lowered with the Debt Management Plan which makes it very convenient and easier for paying off all the existing debts and progress it visibly. When the Debt Management Plan is properly managed, the individual has a better scope of saving a certain amount of money in place of spending all the monthly earnings in paying the pending bills.

The most prominent drawback of Debt Management Plan is the capacity of getting into more number of debts. Individuals who are not concerned regarding their expenses and posses a gambling habit are very vulnerable to get into more debt. Even if the decreased interest rates, you might need to take a longer duration of time to clear out the existing debt with Debt Management Plan. This will result in increased amount of interest payments. To avoid such circumstances, one needs to focus on clearing the debt as soon as possible. 

Even if you have taken Best Renovation Loan Singapore, interest and fines will be heavily imposed when you shall fail to pay the interest timely and regularly.

Debt Management Plan will assist you in making monthly payments low with lower interest rates. Personal loan in the shape of Debt Management Plan will assist in negotiating with the creditors for eradicating the penalties.