DEBT RELIEF ORDER (DRO)
* May not be suitable in all circumstances. Fees apply. Your credit rating may be affected.
A Debt Management Plan (DMP) is an informal agreement between you and your unsecured creditors to repay non-priority debts. It involves consolidating your monthly debt payments to a single, affordable amount.
Advantages
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A DMP allows you to pay one affordable regular payment that is distributed among your creditors. If you have a fee-free DMP, all your payment goes directly to your creditors. If you opt for a fee-charging DMP, a management fee is deducted before your payment is distributed.
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Interest and charges on included debts may be frozen, but this is not guaranteed.
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It can help slow down direct creditor contact, as your DMP provider will handle communications and manage negotiations on your behalf.
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DMPs are informal and flexible. They are not legally binding, so you can leave the plan at any time if your financial situation improves.
Disadvantages
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Fee-charging DMPs may incur monthly fees that are deducted from your payment before it is distributed to creditors. Fees vary by provider.
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There is no guarantee that interest and charges will be frozen.
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Creditors can still contact you about payments and may refuse to co-operate with the DMP.
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A DMP may adversely affect your credit rating for up to 6 years , potentially limiting your ability to obtain new credit.
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Your debts will still have to be paid in full, though the monthly payments will be adjusted to a level you can afford. This may extend the term of your debt repayments.
Achieving debt freedom,
Starting with just 3 simple steps
Step1
Take the first step. Answer a few simple questions to give us an idea of your financial situation.
Step2
Speaking about debt can be tough. Our empathetic, trained experts will explain how we can help.
Step3
Once we’ve discussed your options, it’s over to you. By this point, debt freedom is in your grasp.
We’re ready to talk
* May not be suitable in all circumstances. Fees apply. Your credit rating may be affected.