Reading Time: 5 minutes

If you are thinking about entering debt review, you may be wondering if there are any disadvantages to being in debt review.

Here are a few things to think about when contemplating starting the process:

Making Changes To How You Have Been Spending Money

Paying Back Your Debts Over A Longer Time Period

No More Store Cards & Credit Cards

No More Relying On Credit To Buy Stuff

Let’s take a look at each of those so called disadvantages, and discuss how entering debt review will help you to improve your financial future even with these factors at play.

Making Changes To How You Have Been Spending Money

Making use of credit is super fun. You can get what you want, when you want it. Grab it now and pay for it later. Of course, paying it back is where the trouble begins.

When you enter debt review, you will switch from using credit all the time and not thinking about it, to rather budgeting for what you need. Sticking to a budget after years of not doing so can be a big change. It can take a few months to get into the new way of thinking about spending.

Any change is difficult, so, you have to be really committed to getting rid of your debts before you begin the debt review process.

Paying Back Your Debts Over A Longer Time Period

If you had lots of money and could repay your debts as per your contracts with all your different credit providers, you would repay your debts over the ‘normal’ repayment terms. You would also pay the usual fees and charges each month.

When you enter debt review, your credit providers will agree to take smaller repayments each month, but this means that it will take longer to repay. Fortunately, most credit providers will drop extra fees and charges. Many credit providers will even agree to lower interest rates so that even though you are paying over a longer time, it will not cost you lots of extra money.

No More Store Cards & Credit Cards

When you start debt review you will have to stop using your store account cards and credit cards.

Instead of just using more and more credit, you will have to save up and only spend what you can afford.

This is a big change if you are accustomed to using your cards all the time. Of course, you can switch to using debit cards instead. Still, making the change can feel weird at first. Especially if, in the past, you have struggled to save up money before you buy something.

No More Relying On Credit To Buy Stuff

While you are in debt review, the various credit bureaus put a small note on your credit record to mention that you are in debt review. This is because you are now focused on paying off debt, instead of making more debt.

Until your debts are paid up (other than a bond) this notice will still be there (even if you drop out of the process). That way, credit providers know that your focus has shifted from making more debt, to paying off all your debts. So, no new credit while in debt review.

This is not a “blacklisting” (that doesn’t really exist) but the debt review “flag” is only there while you are in debt review. When you finish the process, it is removed and disappears, no lasting flags against your name.

Cutting off access to credit is a good way to make sure you don’t fall back into bad habits, and rather pay off your debts. Still, it is a real change in the way you think about debt and using credit. Some people find it hard to make the change at first.

Debt Review Advantages & Disadvantages

It is good to know what you are getting yourself into before you commit to the very serious debt review process. So, do your research and know what the advantages and disadvantages of making the change to debt review involves.

There are great advantages like:

Protecting your assets

No more scary collections calls & letters

One payment amount

Amazing concessions from your credit providers

Reckless Lending Investigations

Afford the Essentials Without Relying on Credit

[Read More]: Check Out The Advantages Of Debt Review Here


But you must be aware that it does mean you will have to deal with some of the changes that come with being in debt review like:

Making Changes To How You Have Been Spending Money

Paying Back Your Debts Over A Longer Time Period

No More Store Cards & Credit Cards

No More Relying On Credit To Buy Stuff

Some people find it hard to change from a credit lifestyle (making more and more debt) to living a cash lifestyle. Sticking to a budget can be tricky, at first, but will really help you to finally get your finances under control.

The good news is that with debt review, you can break the chains of using credit just to make ends meet. Every month, you won’t need credit and you will have less and less debt, until it is all paid off.

Debt Review can really work if you educate yourself and are committed to paying off your debts. The advantages far outweigh the disadvantages.