A debt management plan is a way of helping people who are finding it difficult to meet the payments to their creditors and pay off their unsecured debts. This can be set-up through Money Village who do not charge a set-up fee, although a monthly fee is charged for the on-going administration of the plan. Alternatively, it can be set up by a provider who charges no fees.
We work out what you can realistically afford to pay your creditors and negotiate a revised payment plan with them on your behalf. PLEASE NOTE THAT THERE ARE FEES FOR OUR SERVICE. (please see our Key Information page)
Here is a summary of the main advantages and disadvantages of a Debt Management plan with Money Village –
• One single affordable monthly payment.
• Flexibility. Repayments can be varied up or down as circumstances dictate or you can switch to a legally binding, formal solution, such as an IVA, if your circumstances change. If sufficient funds become available to you, we can negotiate reduced settlement figures with some/all of your creditors.
• Established relationships with creditors meaning that our request to stop interest and charges will be seriously considered.
• Priority monthly costs such as mortgage/rental payments, council tax, utility bills and child care costs are taken into account before determining a realistic monthly repayment to your creditors so that these essentials remain affordable. Payments for these must be maintained by you.
• A team of Personal Advisor’s will be available to you to provide on-going help and support. Although we will deal with your creditors on your behalf, they may still contact you directly. Please do not ignore them as this could result in collection actions, including default notices and litigation and the cost of default notices may be added to the debt. Please ask them to contact us.
• Reducing debt repayments means that the repayment period and total amount to be repaid will increase.
• Your credit rating will be impaired by entering a Debt Management Plan as you will no longer be making contractual repayments to your debts. A record of this will be held on your credit file for up to 6 years. This means that you might not be able to obtain credit or other financial services in the short term and there is some likelihood that you will not be able to do so in the medium to long term.
• Debts such as mortgages and other secured loans, HP agreements, utility bills, fines, taxes and child support payments and arrears on utility and Council Tax bills cannot be included in the plan. You must maintain payments to these arrangements. Non-payment may result in repossession of, or eviction from, your home or loss of essential goods and services.
• Whilst we have excellent relationships with creditors, we cannot guarantee that repayment proposals will be accepted or interest and charges suspended or that current (or future) recovery or legal action, which may involve further costs, will be suspended or withdrawn. The plan is not legally binding on creditors. This also applies to any other non-statutory repayment plan.
• Although a debt management programme is flexible, it is important that regular month payments, once agreed, are maintained. Any breaks in repayment may mean that your creditors re-commence collections and/or legal action. You should contact us immediately if you feel that your plan is becoming unaffordable.
Please see our Key Information page for further information.
Need more information? Call 08000 114 999 to Click Here to contact one of our friendly advisors for a confidential chat.