A reader asked if it is OK to reduce your debt management payments when you need to? This is a common problem in Debt Management Plans (DMPs). Sometimes your income falls. Often your essential expenses go up faster than your pay does. In debt management, you pay a set amount to the DMP company and they divide it between your creditors. So what happens if you can no longer afford that monthly … [Read more...]
DMP articles
This page and the following ones list all Debt Camel articles about Debt Management Plans in date order, starting with the most recent.
A good starting point is What is a Debt Management Plan (DMP)?
That has links to the most important articles, covering DMP advantages and disadvantages, the different ways you can set one up, things that can happen in a DMP and how to decide if one is the right option for you.
DMPs can be useful if you have a temporary financial problem for a few months or a year or two, or as a long term way of clearing your debts, but you need to be wary of DMPs that will go on for too long.
What to do if a creditor won’t freeze interest
What can you do if a creditor is still adding interest when they have been asked to stop? This can happen if you have a payment arrangement. It also sometimes happens, but much more rarely, in a Debt Management Plan (DMP). Most creditors do freeze interest if you have supplied a reasonable Income & Expenditure Statement. If you are in a DMP, your DMP firm will have sent the creditor … [Read more...]
Worried about starting a DMP? Answers to common questions.
A reader said she was scared about starting a Debt Management Plan (DMP). She was worried her creditors may not freeze interest and might take her to court. Another reader asked if he can get a new mortgage fix if he is in a DMP I thought it would be useful to look at the most common concerns people have about DMPs. Setting up a DMP Will I get lots of phone calls from creditors? You … [Read more...]
Are people being told the truth about DMP fees and no-fee DMPs?
Misleading DMP advice Mrs B was advised to go into a Debt Management Plan (DMP) by an IVA firm. They referred her to a firm that charges fees for running a DMP. I suggested that she should talk to StepChange or another provider that doesn't charge any fees for a DMP. Mrs B went back and queried the advice with the IVA firm. This is the WhatsApp conversation: I explained to Mrs B that … [Read more...]
7 ways to speed up a DMP so it finishes sooner
A reader asked: I'm being told a DMP would take more than 10 years. Is that too long - I hope my situation will improve? Ten years is a long time. But lots of things can happen during a Debt Management Plan (DMP) which will change the time it may take. Here are seven ways the DMP could be speeded up - not all of them may apply to you. 1. No DMP fees If the DMP firm you are talking to charges … [Read more...]
Can I get a new mortgage fix with poor credit?
A couple of readers have asked about mortgage fixes when they have a poor credit record or simply a lot of other debt: Ms A: We are in a DMP and we were told it would make it very hard to remortgage. So we are now on Santander’s SVR and it’s over 7%. Can we really just ask them for a new fix and they won’t say no? Mr B: I'm worried about talking to Nationwide when our current mortgage fix ends. … [Read more...]
How does a DMP or a payment arrangement affect your credit rating?
A debt management plan (DMP) is a good debt solution for many people who can manage to repay their debts if interest stops being added. If you are trying to decide whether you need one, you may want to know how bad the effect will be on your credit file, and how long it will be before your credit rating recovers. There isn't a simple answer: DMPs are used in a lot of different … [Read more...]
Are you still paying fees on an old Gregory Pennington DMP?
For many years Gregory Pennington (GP), part of the Financial Wellness Group (FWG), has charged its clients monthly fees for running Debt Management Plans (DMPs) But MaPS awarded Gregory Pennington a contract that began on 1 February 2023. And it can't charge fees for DMPs under this contract. StepChange, Payplan and CAP have always provided "fee-free" DMPs, where all a client's payments go … [Read more...]
The debt collector wants to review my monthly payment
Mr A asks: I have had an arrangement with a debt collector for a number of years, paying £10 a month. They have sent a letter asking for a review. Do I have to do this? Can they do anything if I just continue with my current payments? You don't have to give these numbers but... It is a good idea to give revised details Everyone was happy when the arrangement was set up. Mr A was relieved … [Read more...]
Should I stop debt payments before my DMP starts?
A reader asked in mid August 2022: My StepChange DMP will start in October. Do I have to make the payments to my creditors in September? Because it's going to be a real struggle. Could I offer them less? I asked what her StepChange monthly payment will be, and whether that has taken into account rising energy prices in October 2022? It's going to be about £250. She said: I need to admit that … [Read more...]