What are the Advantages of Debt Management?<\/h3>\n\n\n\n- It is an informal and flexible arrangement designed to suit your circumstances and needs.<\/li>
- Payments are tailor made in line with what you can afford.<\/li>
- You do not have to release equity from property.<\/li>
- You will repay all of your debts.<\/li>
- Creditors prefer Debt Management to other processes for resolving financial difficulties.<\/li>
- Your details will not be put on the Insolvency Register.<\/li><\/ol>\n\n\n\n
![\"Couple](\"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-content\/uploads\/2019\/02\/Fotolia_136756545_XS.jpg\")
<\/figure><\/div>\n\n\n\nWhat debts are covered by a Debt Management Plan?<\/h3>\n\n\n\n
All unsecured debts such as loans, credit cards, store cards and bank overdrafts are covered. Your secured debts such as your mortgage or HP agreements are prioritized in your income and expenditure calculations, so that you do not fall behind on these payments.<\/p>\n\n\n\n
How much will I have to pay into a Debt Management Plan?<\/h3>\n\n\n\n
Only what you can realistically afford. The amount you pay each \nmonth,usually by standing order, will depend on your income, your \nexpenditure and your personal circumstances and will be calculated to \nsuit your individual needs and those of your family and dependents.<\/p>\n\n\n\n
Do I have to be employed?<\/h3>\n\n\n\n
No, but you do need a source of income that is more than you require for living expenses.<\/p>\n\n\n\n
Will my Creditors accept my Offer?<\/h3>\n\n\n\n
Not necessarily. There are many good Debt Management Companies \noffering their services who will negotiate with your creditors and who \nhave a track record of getting offers accepted. However, creditors do \nnot have to accept reduced payments or freeze interest and charges and \nthere is no guarantee that any existing or threatened proceeding will be\n suspended or withdrawn and any collection costs incurred by your \ncreditors will normally be added to your debt. The Debt Management \nCompany you choose to use will keep you informed of the progress of \nnegotiations.<\/p>\n\n\n\n
Will my employer know about my Debt Management Plan?<\/h3>\n\n\n\n
No. Reputable Debt Management Companies offer complete \nconfidentiality and privacy in relation to your financial affairs. No \ninformation about you is disclosed to any outside organizations \nincluding your employer. Particular care is taken when making contact \nwith you to ensure that others will not find out about your \ncircumstances.<\/p>\n\n\n\n
Will I have to open a new bank account?<\/h3>\n\n\n\n
Yes, you almost certainly will have to open a new bank account. Most \npeople nowadays have their wages\/salary\/benefits paid into a bank or \nbuilding society with which they also have debts \u2013 such as an overdraft,\n credit card or loan. This can be quite messy when the Debt Management \nProgramme commences, since your existing bank or building society may \nseek to use all of your wages\/salary\/benefits to address the deficits in\n your accounts with them, to the disadvantage of your other creditors. So it is best to open a new bank account with a bank or building society that is not connected to your existing bank.<\/em><\/strong>\n You will have to ensure that your wages\/salary\/benefits are paid into \nthis new account and that your priority payments (mortgage, rent, \ncouncil tax, car HP etc) are made from the new account also. These steps\n will ensure that you remain in control of your income and that all of \nyour creditors are treated on a fair and equitable basis.<\/p>\n\n\n\nWhat about my existing direct debits?<\/h3>\n\n\n\n
You will have to cancel in writing<\/em><\/strong> with your existing bank and with your creditors<\/em><\/strong> all direct debits in relation to the unsecured debts that are being entered into your Debt Management Programme.<\/p>\n\n\n\nHow much will my Debt Management Plan cost me?<\/h3>\n\n\n\n
Debt Management Companies fees vary from one to the other. Most of \nthem charge a set up fee equal to the debtor\u2019s first monthly payment \ninto the DMP. This means that creditors receive nothing for the first \nmonth. Thereafter, charges are usually a fixed percentage of the monthly\n payment made by the debtor. The average monthly charge is 15% with a \nminimum of around \u00a325 and a maximum of around \u00a3100. As you shop around, \nyou will find that charges vary however.
\nExample: you enter a DMP and agree to make monthly payments of \u00a3300. \nYour DMP Company retains the first payment of \u00a3300 in respect of set up \nfees. Thereafter, it charges \u00a345 per month and distributes the remaining\n \u00a3255 to your creditors on a pro-rata basis.<\/p>\n\n\n\n
Will my Debt Management Plan affect my credit rating?<\/h3>\n\n\n\n
Yes, almost certainly. It may already be affected if you currently \nhave arrears or a history of missed payments or late payments. As your \nDebt Management Company now negotiates reduced monthly payments to your \ncreditors, it means that you will no longer be making the payments \noriginally agreed and a note of this may be made on your credit file. \nThe credit reference agencies retain such records for six years.<\/p>\n\n\n\n
How long will my Debt Management Plan last?<\/h3>\n\n\n\n
This depends on your personal circumstances. However, the Debt \nManagement Company you engage should be able to estimate the length of \nthe arrangement, once it has received all your personal information.<\/p>\n\n\n\n
What will happen if my circumstances change?<\/h3>\n\n\n\n
Because a Debt Management Programme is flexible and informal, it is \nnot as rigid as other processes. Your Debt Management Company will \nprobably have assigned a liaison officer with specific responsibility \nfor your DMP. Keep your contact person fully aware of your circumstances\n at all times and particularly in relation to any direct correspondence \nor contact from your creditors or any changes to your income and \nexpenditure.<\/p>\n\n\n\n
Are there any alternatives to a Debt Management Plan?<\/h3>\n\n\n\n
There are many alternative courses of action if you are in financial \ndifficulty. You should be aware of all of your options before you decide\n which way to go. Some of the most common alternatives are Bankruptcy, \nIndividual Voluntary Arrangement, Debt Relief Order, Debt Consolidation,\n Asset Sale & Debt Settlement and Property Remortgage & Debt \nSettlement. It may even be that financial assistance is available from \nfamily or friends.<\/p>\n","protected":false},"excerpt":{"rendered":"
Read some of our most Frequently Asked Questions about Debt Management<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[4],"tags":[],"class_list":["post-3086","post","type-post","status-publish","format-standard","hentry","category-debt-management-articles"],"_links":{"self":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3086","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/comments?post=3086"}],"version-history":[{"count":2,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3086\/revisions"}],"predecessor-version":[{"id":3556,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3086\/revisions\/3556"}],"wp:attachment":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/media?parent=3086"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/categories?post=3086"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/tags?post=3086"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
<\/figure><\/div>\n\n\n\nWhat debts are covered by a Debt Management Plan?<\/h3>\n\n\n\n
All unsecured debts such as loans, credit cards, store cards and bank overdrafts are covered. Your secured debts such as your mortgage or HP agreements are prioritized in your income and expenditure calculations, so that you do not fall behind on these payments.<\/p>\n\n\n\n
How much will I have to pay into a Debt Management Plan?<\/h3>\n\n\n\n
Only what you can realistically afford. The amount you pay each \nmonth,usually by standing order, will depend on your income, your \nexpenditure and your personal circumstances and will be calculated to \nsuit your individual needs and those of your family and dependents.<\/p>\n\n\n\n
Do I have to be employed?<\/h3>\n\n\n\n
No, but you do need a source of income that is more than you require for living expenses.<\/p>\n\n\n\n
Will my Creditors accept my Offer?<\/h3>\n\n\n\n
Not necessarily. There are many good Debt Management Companies \noffering their services who will negotiate with your creditors and who \nhave a track record of getting offers accepted. However, creditors do \nnot have to accept reduced payments or freeze interest and charges and \nthere is no guarantee that any existing or threatened proceeding will be\n suspended or withdrawn and any collection costs incurred by your \ncreditors will normally be added to your debt. The Debt Management \nCompany you choose to use will keep you informed of the progress of \nnegotiations.<\/p>\n\n\n\n
Will my employer know about my Debt Management Plan?<\/h3>\n\n\n\n
No. Reputable Debt Management Companies offer complete \nconfidentiality and privacy in relation to your financial affairs. No \ninformation about you is disclosed to any outside organizations \nincluding your employer. Particular care is taken when making contact \nwith you to ensure that others will not find out about your \ncircumstances.<\/p>\n\n\n\n
Will I have to open a new bank account?<\/h3>\n\n\n\n
Yes, you almost certainly will have to open a new bank account. Most \npeople nowadays have their wages\/salary\/benefits paid into a bank or \nbuilding society with which they also have debts \u2013 such as an overdraft,\n credit card or loan. This can be quite messy when the Debt Management \nProgramme commences, since your existing bank or building society may \nseek to use all of your wages\/salary\/benefits to address the deficits in\n your accounts with them, to the disadvantage of your other creditors. So it is best to open a new bank account with a bank or building society that is not connected to your existing bank.<\/em><\/strong>\n You will have to ensure that your wages\/salary\/benefits are paid into \nthis new account and that your priority payments (mortgage, rent, \ncouncil tax, car HP etc) are made from the new account also. These steps\n will ensure that you remain in control of your income and that all of \nyour creditors are treated on a fair and equitable basis.<\/p>\n\n\n\n You will have to cancel in writing<\/em><\/strong> with your existing bank and with your creditors<\/em><\/strong> all direct debits in relation to the unsecured debts that are being entered into your Debt Management Programme.<\/p>\n\n\n\n Debt Management Companies fees vary from one to the other. Most of \nthem charge a set up fee equal to the debtor\u2019s first monthly payment \ninto the DMP. This means that creditors receive nothing for the first \nmonth. Thereafter, charges are usually a fixed percentage of the monthly\n payment made by the debtor. The average monthly charge is 15% with a \nminimum of around \u00a325 and a maximum of around \u00a3100. As you shop around, \nyou will find that charges vary however. Yes, almost certainly. It may already be affected if you currently \nhave arrears or a history of missed payments or late payments. As your \nDebt Management Company now negotiates reduced monthly payments to your \ncreditors, it means that you will no longer be making the payments \noriginally agreed and a note of this may be made on your credit file. \nThe credit reference agencies retain such records for six years.<\/p>\n\n\n\n This depends on your personal circumstances. However, the Debt \nManagement Company you engage should be able to estimate the length of \nthe arrangement, once it has received all your personal information.<\/p>\n\n\n\n Because a Debt Management Programme is flexible and informal, it is \nnot as rigid as other processes. Your Debt Management Company will \nprobably have assigned a liaison officer with specific responsibility \nfor your DMP. Keep your contact person fully aware of your circumstances\n at all times and particularly in relation to any direct correspondence \nor contact from your creditors or any changes to your income and \nexpenditure.<\/p>\n\n\n\n There are many alternative courses of action if you are in financial \ndifficulty. You should be aware of all of your options before you decide\n which way to go. Some of the most common alternatives are Bankruptcy, \nIndividual Voluntary Arrangement, Debt Relief Order, Debt Consolidation,\n Asset Sale & Debt Settlement and Property Remortgage & Debt \nSettlement. It may even be that financial assistance is available from \nfamily or friends.<\/p>\n","protected":false},"excerpt":{"rendered":" Read some of our most Frequently Asked Questions about Debt Management<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[4],"tags":[],"class_list":["post-3086","post","type-post","status-publish","format-standard","hentry","category-debt-management-articles"],"_links":{"self":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3086","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/comments?post=3086"}],"version-history":[{"count":2,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3086\/revisions"}],"predecessor-version":[{"id":3556,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3086\/revisions\/3556"}],"wp:attachment":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/media?parent=3086"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/categories?post=3086"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/tags?post=3086"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}What about my existing direct debits?<\/h3>\n\n\n\n
How much will my Debt Management Plan cost me?<\/h3>\n\n\n\n
\nExample: you enter a DMP and agree to make monthly payments of \u00a3300. \nYour DMP Company retains the first payment of \u00a3300 in respect of set up \nfees. Thereafter, it charges \u00a345 per month and distributes the remaining\n \u00a3255 to your creditors on a pro-rata basis.<\/p>\n\n\n\nWill my Debt Management Plan affect my credit rating?<\/h3>\n\n\n\n
How long will my Debt Management Plan last?<\/h3>\n\n\n\n
What will happen if my circumstances change?<\/h3>\n\n\n\n
Are there any alternatives to a Debt Management Plan?<\/h3>\n\n\n\n