A Debt Management Plan is an informal arrangement made between yourself and your creditors to reduce the amount of your debt repayments.

To begin a Debt Management Plan you can either attempt to negotiate it yourself or alternatively there are a wide range of companies and organisations that offer Debt Management services. These organisations include the Citizens Advice Bureau and the National Debtline who both provide general support for consumers looking to sort out their own debt problems. There is also the Consumer Credit Counselling Service (CCCS)which offers debt management programmes and is funded by major UK creditors.

BENEFITS OF DEBT MANAGEMENT PLANS

Arranging a Debt Management Plan can be an effective way to reduce your regular debt repayments. Debt Management Plans offer a large degree of flexibility and aren't bound by strict qualifying criteria. For this reason they are an option for a much wider range of people than is the case with IVAs.

DISADVANTAGES OF DEBT MANAGEMENT PLANS

The main drawback of Debt Management Plans is that the arrangement is an informal one and so there are no legal guarantees that further interest and charges will not be added to the debt. Also as Debt Management Companies will charge a fee for their services this fee will be added to your existing debts and so will increase the length of time it takes for the debt to be repaid. Currently there is no restriction upon who can set up a debt management company in the UK or the amount of fees which can be charged.

I-V-A.org.uk is part of a group of Licensed Insolvency Practitioners who are legally able to prepare and manage IVAs from start to finish. As part of our service we are able to provide you with free impartial debt advice to help you find the best solution to your debt problems. To speak to one of our advisors simply call us on freephone 0800 054 50 43 or alternatively complete our enquiry form.