Qualifying for a DMP
Debt Management Plans are available to those struggling to repay debts of £2,000 or more. The following criteria is used as a guide, therefore we suggest you call us on 0800 096 1331 for a free initial consultation to make sure this is the best debt solution for you.
Debt Management Plan benefits
| Tailored plans: | Plans are tailored to meet your personal circumstances – enabling you to get your finances back on track. Of 84% of debts managed we freeze interest and charges. |
| Affordable repayments: | One affordable payment each month which we distributed between your creditors. |
| Clear debts: | On successful completion, you will become free from the unsecured debts included in the DMP. |
| Peace of mind: | We deal with creditor phone calls and letters – helping to ease the stress of dealing with your debts. |
| Flexibility: | A Debt Management Plan is an informal agreement; this means you are not bound by a contract. If you feel that you are in a better position financially, you can increase repayments which will help you repay creditors in a shorter amount of time. |
Debt Management Plan: what you need to know
| Interest and charges: | Creditors are not obliged to freeze interest and charges – this means the companies you owe money to could continue to add to your debt. Of 84% of debts managed we freeze interest and charges, and we will discuss this with your creditors at the same time as negotiating lower repayments. |
| Repayment period: | By choosing to repay your debts at a reduced rate, you could increase the amount owed and the period in which you repay your debts. |
| Credit rating: | Your credit rating will be affected in the medium to long term. However if you already have a history of late or missed payments, your credit rating may already be affected. |
| Obtaining credit: | You may find it difficult to secure credit in the future. |
| Debts: | Only unsecured debts can be included in a DMP. For example: personal loans, store cards, credit cards, bank overdrafts and catalogue accounts. |
For specialised DMP advice, call us on 0800 096 1331.
What debts can be included in a DMP?
Only unsecured debts can be included in a Debt Management Plan – this means any debt not secured against a property or assets. The lists below are examples of the types of debts included and excluded from DMPs.
Debts that can be included in a DMP:
- Personal loan
- Store card
- Credit card
- Bank overdraft
- Catalogue account
Debts that are excluded from a DMP:
- Mortgage
- Hire purchase loans (car loans)
- Secured loans
- Council tax
- Water rates / gas / electricity bills
- TV license
- Student loan
A Debt Management Plan is not a formal agreement; therefore your creditors do not have to agree to reduce repayment rates. If they do not agree to enter a DMP, then you will have to continue to make payments in full to these creditors.
What is disposable income?
Disposable income is the amount of money you’re left with after paying general household expenses, food, clothing, mortgage / rent, utility bills, council tax and hire purchase loans.
To work out your disposable income, we will help you complete a detailed expenditure form listing your income and total expenditure. If the amount you’re left with is a minimum of £80, then you could qualify for a Debt Management Plan. Rest assured your priority bills will be taken into account when we are calculating an affordable monthly pay plan for you.
Don’t be ruled by debt
Dealing with debt can be stressful, but at Baines & Ernst we will support you every step of the way. Visit our accreditations page to find out why we’re a leading choice for people who want to clear their debts.
For free initial advice, call us on 0800 096 1331.
Baines and Ernst Ltd