What is it?
A Debt Management Agreement is co-ordinated by a specialist company on your behalf and provides a structured repayment schedule for your creditors, with all debts eventually being repaid via an agreement.
What are the Benefits?
- You send one payment each month to the debt management company and they forward the appropriate amount to each individual creditor on your behalf
- The debt management company handles all communication with your creditors, and they negotiate repayments on your behalf
- The debt management company will attempt to have interest frozen on your account (although this is largely unsuccessful)
- Day to day control of your debts is passed to the debt management company.
Are there any disadvantages?
- Unlike with an Individual Voluntary Arrangement, you do not have any court protection and dissatisfied creditors may still continue legal action against you
- Creditors are unlikely to freeze interest on your accounts
- There is no "end date" to your debt problems. A debt management agreement should be only considered as a short-term solution, or if your aggregate debts are lower than £15,000.
What are the alternatives?
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