Debt Management

Debt Management Plans, otherwise known as DMPs, enable a debt management company to liaisie with your creditors for you, and agree affordable re-payment of the debt, based on your realistic disposable income. 

DMPs are often an option people go for, if their debt is a short term problem. A Debt Management Plan is a much more informal arrangement than an IVA and is based on what you feel you can afford to give back to your creditors each month. The Debt Management company, will then negotiate this figure with your creditors to try and reach an agreement, and in some cases, may also get your creditors to agree to freezing your interest - but this is never a guarantee

Benefits of a Debt Management Plan:

• Multiple monthly payments combined into one manageable payment.
• No more angry phonecalls - all communication with creditors will be carried out via your DMP Advisor.
• An affordable repayment plan, enabling you to live sensibly whilst keeping up payments.
• Once the DMP is in place, the DMP Advisor can request that creditors do not make any changes to the agreement or add further interest / charges.

• You will have difficulty obtaining further credit before their DMP is completed.
• Default notices are recorded on your credit file.
• A DMP is NOT legally binding so creditors can still move forward with court action.
• Creditors do not have to agree to freezing interest or penalty charges incurred.
• It could take several years to pay off the debt owed - this is not a quick fix solution.