A Debt Management Plan or DMP is an informal solution which allows you to repay back your debts with one affordable payment each month. Due to a DMP being informal your interest and charges are not guaranteed to be frozen but this is negotiated with the creditors. All the work is done on your behalf so you don’t need to speak to your creditors.

Being on a DMP can help ease off the pressure from your creditors although in some cases they may still contact you. The amount you pay each month towards your DMP is determined after running through your income and expenditure with a debt advisor. Ensure you’ve compared your Income/Expenditure to your Bank statement and therefore not missing anything out.

Some DMP providers have a fee involved for setting up the DMP and running it, which is usually integrated within the monthly payment you make. If you have a large amount of Debt then in some cases the DMP may not be the best option as it could take a long time to pay back your debts. The DMP is a good option if you’re situation is likely to improve going forward and you can consistently manage the plan.

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