Debt Management – What is debt management and how can it help you?

A debt management plan (DMP) is a short term financial solution that is designed to help you re-pay your debts under a more manageable payment plan.

Debt management is ideally suitable for those who have un-secured debts of over £3000 and less than £15,000.

Lower affordable payments

Under a debt management plan you agree to make a set monthly affordable payment into the plan and you creditors (the people or companies you owe money too) agree to make concessions like to freeze or eliminate the interest payments and to accept lower payment.

Your debt management company will deal with all of your creditors (this may be un-secured loan companies, hire purchase, credit card providers and companies etc) and they will handle all the negotiations and paperwork on your behalf.

You pay the set amount agreed to the debt management company and in turn the debt management company pays your creditors and acts as an intermediary between yourself and the people you owe money to.

Many people find that this debt management process helps to remove the emotional stress out of having to deal with creditors directly and often find comfort in the support and structure that a debt management plan provides.

Things you should consider about a debt management plan are:

• You may end up paying back more over the period of the plan.
• The plan may extend the period from which you have to make payments.
• A debt management plan may affect your credit rating.
• Your creditors may charge extra fees and charges as part of the plan.

Other options

Depending on your circumstances you may find that an IVA is a more suitable arrangement. However, we can disuses this with you in more detail to provide the correct debt solution for you.

Clearing your debts with debt management

It’s important to note that the sooner you act, the more positive your situation will be and the more we will be able to help you.

Best Wishes, Susan.

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