A Debt Management Plan is designed for those who find their unsecured repayments unmanageable and are looking to reduce the amount that they have to repay on a monthly basis.
This type of Debt Management Plan is an informal agreement between you and your unsecured creditors. A Financial Solutions Company, such as One Advice, will negotiate with your unsecured creditors to make your monthly payments affordable to you.
You may be worried that you are not eligible for a debt management plan because you do not have the minimum amount of debt required for a debt management plan. But the ability to repay your debts is more important than the level of unsecured debt that you owe.
With a Debt Management Plan, although your monthly payments will be reduced, you will still have to repay your debts in full and reducing your monthly payments mean it will take you longer to do this.
If your debts are over £15,000 you could reach the minimum amount of debt required for a debt management plan alternative called an IVA (Individual Voluntary Arrangement). Like a Debt Management Plan, an IVA will allow you to make smaller monthly repayments to your debts but with additional benefits.
An IVA is legally binding between you and your unsecured creditors and you only have to repay the debt which is affordable to you. After you have finished making the IVA repayments (over a typical period of 60 months) any unpaid debt will be written off as long as you have complied with the terms of the IVA.
The best way to see what debt solution is right for you, based on the amount of debt that you have and what is affordable, is to get in touch with an expert debt advisor who can talk you through your options. One Advice have a team of expert debt management advisors who can help find you a debt solution.