Debt Management Plan

Debt Management Plan is an informal arrangement between debitor and creditors that allow debitor to pay reduced monthly payments on their outstanding, unsecured debts.

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Debt Management Plans (DMP) are ‘informal’ arrangements reached between the debtors and their creditors for the clearance of the debt. Given the fact that these plans are not legally binding, both creditors and debtors can end the arrangement any time they wish.

Debt management plans are ideal for those who are facing a temporary financial setback, for example, due to loss of job. To qualify for a DMP, debtors must have a minimum of £3000 worth of unsecured non-priority debts. Non-priority debts include credit cards, bank loans, over drafts, catalogues, store cards etc that are not secured on property and other assets such as car etc. Things like mortgage, utility bills, council tax, CSA payments and student loans can’t be included in your debt management plan.

The debtors should also have a disposable income of £100 per month for regular repayments.

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Debt Management, debt solutions, debt management help