Debt Management Plan (DMP)
Clear your unsecured debts in full, by making affordable monthly payments set at an amount you can realistically afford.
What is a DMP?
A Debt Management Plan allows you repay your debts in full by making reduced payments to your unsecured creditors.
However, there is no guarantee that interest & charges will be frozen, or legal action stopped. This means it will probably take longer to repay your debts in this debt solution.
A DMP is a good debt solution if you are struggling to repay your unsecured debts, but you don’t have a high amount of debt, and you could pay back your unsecured creditors in a reasonable amount of time.
Is a DMP right for me?
A DMP might be right for you if can’t meet the required repayments from your unsecured creditors. In order to qualify for a PayPlan DMP you should also have a minimum unsecured debt level of £5,000.
It’s a flexible way to make one affordable payment each month to your creditors.
Debt solutions vary greatly depending on your individual financial circumstances, so if you are struggling to repay your unsecured debts, call PayPlan for FREE debt advice. We will talk to you about your situation and discuss what options are available before recommending what solution will be most beneficial for you.
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Advantages and disadvantages of a DMP:
- It’s an informal agreement between you and your unsecured creditors, so there are no formal procedures to go through. However, the downside to this is that there is no guarantee that your creditors won’t take legal action against you.
- You could end up making only one monthly payment to your creditors at a reduced rate that you can realistically afford. However, because you are paying less than the contractual amount to your unsecured creditors, this is likely to have an adverse effect on your credit rating, and it will take you longer to clear your debts. There is also no guarantee that your creditor will freeze interest & charges – so you could be paying a lot more for a lot longer.
- You pay all your debts back at an affordable rate.
- Contact from your creditors should be reduced. We will take over all contact with your creditors so you shouldn’t have to worry so much about scary letters or hassling calls.
- Your DMP is not a formal agreement, so it can be adjusted to suit your needs. However, fluctuations in payments could affect your credit rating and the length of time it takes to rid yourself of your unsecured debts.
Alternative solutions we may suggest:
If you are struggling to manage your debts and not sure what to do, get in touch with PayPlan.
All our advisors are fully trained and will offer you FREE and confidential advice.
If you are missing payments and not sure what help is available, we can help take the burden off you, and help you find the right debt solution to get your life back on track.
You don’t have anything to lose from making one call…
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