A Debt Management Plan (sometimes called a “reduced payment plan”) can help you get back in control of your finances by giving you one single payment to simplify your debts.

Advantages

• Each plan is designed for your individual circumstances.
• We calculate how much you can afford after all your essential living costs.
• One single affordable payment for all your unsecured credit commitments. At a date to suit you each month.
• We negotiate with your creditors on your behalf and request they freeze interest and stop any charges. We deal with all the paperwork.
• A Direct Line to your own Account Manager. You will always speak to the same person each time.
• A monthly statement. So you can keep up to date with your account.

Disadvantages

• A debt management plan could lengthen the time it takes for you to repay your debts, possibly increasing the amount that needs to be repaid, depending on your circumstances.
• Your credit reference file will show details of the debt management plan. This may affect your ability to get credit in the future.
• There is no guarantee that your creditors will accept the reduced payments and/or freeze future interest payments
• During the negotiation process some creditors may continue to charge interest and other recovery charges. We cannot always prevent these charges being levied. These will however be paid off as part of your Debt Management Plan.
• Entering into a Debt Management Plan will cause you to go into arrears with your creditors.

We can help with many types of debts - not just from unsecured borrowing. Any service, which you’re no longer using where money is outstanding, has the potential for inclusion.

Unsecured borrowing

• credit card debts.
• personal loans with finance companies.
• bank and building society loans, overdrafts and credit cards.
• store / charge cards.
• catalogues.
• doorstep-collected loans.
• credit sale agreements .

No longer user of service

• Disconnected mobile phone bill.
• Gas, electric or water bills (a previous address and supplier).
• Rent arrears (from a previous address).

Shortfalls on repossessed items

If your home or other assets have been repossessed and sold, there may remain a shortfall for which you remain liable. Such debts are unsecured and can be included in a Debt Management Plan.

Hire purchase agreements or secured loans

If you fail to make hire purchase or secured loan payment, e.g. for a car, then the finance company are likely to repossess it. An allowance will therefore be made for these payments to be maintained in a Debt Management Plan.

Priority Debts

You need to deal with some debts more urgently than others because the consequences of not paying them can be very serious.

Even when you enter into a Debt Management plan you will still be responsible for your “Priority Debts” as the law gives creditors different ways of getting their money back. This type of debt includes;

• Mortgage and rent arrears (current address).
• Council Tax / Arrears.
• Gas and electricity (current supplier).
• Any fine, penalties or liabilities imposed by a court.

With a Debt Management Plan, a significant proportion of the work we do for you takes place at the start of the arrangement. This involves the initial consultation, examination of your income and expenditure, and liaison with your creditors to reach an agreeable and affordable repayment plan.

As a result we retain the first three monthly payments as a fee that covers the cost of initiating the Debt Management Plan. These are charged to you in six equal monthly instalments starting from your first payment. This ensures that your creditors will receive payments from the outset of your Debt Management Plan.

On an ongoing basis (after intial fees are paid) we will retain a fee of 17.5% (subject to a minimum of £38) of each monthly payment made by you, facilitating an Account Manager who is available to assist you whenever the need arises plus an annual review of your circumstances to ensure the plan is affordable.

Terms & Conditions apply.