Who may be suitable for a Debt Management Plan?
Have 2 or more unsecured creditors
Live in England, Wales or Northern Ireland
Have a debt level of £1,500 or more
Have a regular income
Want to find out if you qualify?
If you are unsure on which debt solution is the right option for you, our friendly team of experts are here to advise you. All of our advice is completely confidential and tailored to your specific circumstances.
If you need further support in your decision-making process, reach out, we are happy to help.Contact the DFH team
Debt Management Plan Advantages
Stop Creditor Contact
If creditors agree to the Debt Management Plan, any communications you have with them should significantly decline. From bailiff/enforcement action to demands for payments, you can expect these to become non-existent or, at the very least, a rarity.
Freeze Interest and Charges
In most cases, interest rates and charges will be frozen as part of a Debt Management Plan. This gives you time to focus on just repaying the amounts – rather than focusing on paying off additional costs.
A Private Approach to Debt Repayment
During some financial solutions, such as an IVA or bankruptcy, an individual’s name will be added onto the Insolvency Register. This is a legal database which can be searched by anyone. However, this will not occur as part of a Debt Management Plan.
Debt Management Plan Considerations
Your Credit Rating Will be Affected
Your ability to obtain credit will be affected in the short, medium or long term, and repaying debt over a longer period may increase the total repayment amount if interest and charges aren’t frozen.
DMPs Only Cover Non-Priority Debt
Only non-priority debts can be included in a Debt Management Plan. These include such debts as credit cards, catalogues, and personal loans. For debts including mortgages, utility bills, or council tax, you should consider an alternative financial solution. If you have a mixture of non-priority and priority debts, we can offer you expert advice on where it is best for you to get support. Please reach out – our team is happy to help you.
A DMP is an Informal Agreement
A Debt Management Plan is not a legally binding agreement. This means that the companies you owe money to are not required to accept it. As a result, they don’t have to freeze interest rates and charges. Finally, as the plan is not a legally binding agreement, your creditors do not have to honour any informal agreement we set up with them.
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Important to note
Repaying your debt over a longer period of time may increase the amount you pay. Joining a Debt Management programme won’t always show up on your credit report, but it could still affect your ability to obtain credit – making a new repayment agreement with your creditors does mean you’re not following the original agreement.