Debt Management

• An informal agreement that can be stopped at any time.
• You may be able to vary your payments if your circumstances change for the good or bad.
• Interest and charges could be frozen (if creditors agree). A debt management company will negotiate with creditors on your behalf, so offers are more likely to be accepted and interest frozen than if you try to do this yourself.
• Creditor pressure is eased as they deal with us.
• 1 easy monthly payment to cover all unsecured debts.
• A Debt Management Plan is not binding on creditors who do not want to take part, but they cannot refuse any payments made to them.
• A Debt Managment Company will handle everything on your behalf including setting up the plan, distributing paymetns and dealing with any creditor correspondence.
• Creditors may be prepared to negotiate or write off the remaining balance of what you owe after a period of time if
• You have shown to make every effort possible to repay the debt.
• You have maintained regular payments
• You can gain access to a lump sum to go towards the debt and settle completely.

• A Debt Management Plan can remain on credit file for sometime after completion if a default notice has been issued.
• If your creditors refuse to freeze or reduce interest this can lead to increased debt level as repayments are less than original contractual payments. Any further collection actions may incur costs that will normally be added to the debt.
• Debts will be repaid over a longer period of time than if contractual payments were made.
• You will repay debts until they are paid in full, unless you opt out of the plan to go back to your usual debt repayments.
• Repaying debt over a longer period may increase the total amount to be repaid.
• Your ability to obtain credit will be affected in the short term and might be affected in the medium to long term.
• A Debt Management Company cannot guarantee that interest and charges will be frozen, although they may have more success than if you were to try and do this yourself.

A Debt Management Plan deals with all your unsecured debts which are debts like loans, credit cards, store cards and bank overdrafts. If you have secured debts such as a mortgage or HP agreement, these should be prioritised in your income and expenditure. We will always help and advise you with how to deal with your secured and priority debts.

Yes. Anyone can enter into a Debt Management Plan, as long as you have some sort of monthly disposable income, after your living expenses have been taken out.

Your payments and your situation will be reviewed by your assigned finance manager periodically. If your income and expenditure fluctuate and your situation improves, there may be an opportunity to increase your monthly Debt Management payment and this will shorten the life of your Plan. However, if your situation deteriorates, it may be possible to temporarily reduce your payments until they improve.

The cost of a Debt Management Plan varies. It is free if you arrange it yourself or if you go through on of the charitable debt management companies. There are also debt management companies that take a fee every month from your payment

Entering into a Debt Management Plan should have a negative effect on your credit rating because your creditors will be receiving a reduced payment every month. However, if you are thinking about entering into a Debt Management Plan, then it is likely that your credit rating is already affected. This is because you may have been struggling to keep up to date with repayments and your creditor/s will have registered the missed payment/s on your credit file.

As well as negotating your payments with your creditors, your Debt Management Company should try and get interest and charges frozen, although it is never guaranteed as your creditors are not legally obliged. Most Debt Management Companies should have a good relationship with the creditors which can prove helpful in these circumstances.