A Debt Management Plan can often help when you are in employment and/or earning a regular income, but you don’t have enough free cash on a monthly basis to meet your debt obligations. If you are considering a Debt Management Plan as a way of helping you reduce the pressure on your finances you should understand exactly what is involved before you start.
Debt Management Plan providers will:
- Provide direct negotiation with your creditors on your behalf, including asking them to freeze interest payments so your situation doesn’t worsen.
- Handle all the letters from your creditors and ask them to stop sending them to you
- Prepare a financial statement to show your creditors details of your household and personal spending to demonstrate what you can realistically afford
- Accept one monthly payment off you which is based on what you can realistically afford
- Arrange to share money you pay into the plan fairly between your creditors
You should also be aware of the following:
- During the negotiation process, some creditors may continue to charge interest and other recovery charges. This cannot always be prevented but these charges will be paid off as part of your Debt Management Plan.
- You might also incur extra or new charges as a result of missing payments whilst your Debt Management Plan is being set up.
- Creditors do not have to agree to freezing interest and charges.
- As a result of switching to a Debt Management Plan, the total amount repaid and the repayment period may BOTH increase.
To find out more, simply call us today on our free phone number 08002 800 492 or fill in the Contact Money Advice Group form on this page and we’ll call you back. Alternatively, please visit Belmont Financial Management Consultants’ Debt Management Page .
Money Advice Group is the parent company of Belmont Financial Management Consultants (Belmont FMC), Belmont FMC is the service provider of Debt Management Plans (DMPs) and will be the company responsible for providing the Debt Management Service that includes, but is not limited to, receiving payments from you and distributing payments to creditors, giving advice & on-going support and working with you during your plan. Belmont FMC is a wholly owned subsidiary of Money Advice Group. Details of Belmont FMC’s Debt Management Plan fees can be found here.