What is a Debt Management Plan?
A Debt Management Plan (DMP) allows you to pay off your debts at a rate you can afford. Your DMP provider will help you work out an affordable monthly payment and talk to your creditors. You make one monthly payment and this is divided amongst your creditors ensuring all your debts are being paid.
A DMP could be a good debt solution for you if you have some money left over each month after paying for food, accommodation and utility bills.
If you have a higher amount of debt, a DMP may not be the right solution for you as it could take you a lot longer to pay back your debts.
A DMP can be used for non priority debtsThese may include:
Advantages of a DMP
A plan can be agreed for any level of debt.
The DMP does not include your assets.
One Monthly Payment
One affordable monthly payment to your creditors.
Disadvantages of a DMP
Not Legally Binding
The DMP agreement is not legally binding.
Interest & Charges
Creditors may continue to add interest and charges.
Once the DMP has been assigned, creditors may continue with legal proceedings.
There are other formal solutions that might be better in certain circumstances. At Free Debt Settlement we will advise you of all the available options so you can see whether there is an alternative option that will get you out of debt quicker. Call a Personal Finance Manager on 1 (646) 846 7214 for free advice.