Debt control is important because it helps one to clear a debt, save money and at the same time avoid unnecessary expenses. A debtor should make sure that he or she makes regular payments so that the debt does not grow. One may be forced to try out debt consolidation. This involves taking one loan to clear many others. Many people do this to secure a lower interest rate or to secure a fixed interest rate.
Debt consolidation also helps one to service only one loan. Often, consolidation involves a secured loan against an asset or assets that are used as collateral. In other times however, it can involve various unsecured loans into one unsecured loan.
A person can also do debt control through debt management. Debt management involves a third party helping a debtor with the repayment of his or her debts. It could also mean the routine practice by an individual to spend less than he or she earns. A management plan involves compiling a list of all creditors and the amounts owed to each. The total number of the debts is then calculated. A debtor’s total income and total expenditure are calculated as well.
Debt counseling also helps in managing debts. Counseling involves educating people about how they can avoid incurring debts that they cannot manage to repay. Often, counseling involves negotiating with a creditor to come up with a debt management plan for a debtor. A debt management helps in debt control in the sense that a debtor works out a repayment plan with the creditor.