Frequently Asked Questions
Debt Management Plan
What is the difference between fee free and fee charging advisers?
The level of professionalism employed by fee free or fee charging advises is the same. A fee taking debt Management Company will typically take the first months payment as a fee. This is to cover their negotiation with creditors and the inevitable paperwork involved in liaising with your creditors. Thereafter a fee of 10 ? 20% can be taken to administer the plan on a monthly basis.
By contrast a no fee charging debt management provider will agree a monthly payment from you to the creditors. This will then be divided up between the different creditors. In stead of subtracting a fee before they hand over the money to creditors instead the creditors will pay them a fee of about 15% for collecting the money on their behalf.
Which debts can't be included in a debt management plan?
What is the main benefit of a Debt Management Plan?
How will the plan affect my credit rating?
Will my lenders freeze the interest to make the debt management plan attractive?
What happens if I can't keep up with the reduced payments?
Will my creditors still contact me?
What is a typical time period for a debt management plan?
What is the difference between fee free and fee charging advisers?