To be eligible for a debt management plan you have to meet certain criteria, read more below.
We can help you find advice and solutions for those with unmanageable unsecured debts, however to be eligible to enter a debt management plan, there are certain criteria. If you don’t meet the criteria, a debt management plan might not be the option for you, however there are a range of other debt solutions available including IVAs, Trust Deeds (Scotland), Debt Consolidation and Bankruptcy which may suit your needs. Whatever your situation, we are always able to help you find the best solution. A Financial Solutions Advisors will be able to talk to you about your financial situation and will discuss whether a debt management plan is the right option for you. If it’s not, they will be able to point you in the direction of a more suitable solution to your debt problems.
Eligibility for a debt management plan requires you to answer yes to the following questions:
• are you struggling with your finances?
• do you currently owe money on unsecured loans, credit cards, store cards or catalogue bills?
• do you owe more than £3000 to your creditors?
• are you paying more than £120 in repayments each month?
• do you have an income of £500 or more a month?
• do you owe money to 2 or more companies?
If you have answered yes to the above questions, you should definitely consider taking out a debt management plan, our partners will be able to provide you with advice and discuss whether a debt management plan is the right option for your circumstances. From your creditors point of view whether you are eligible, different lenders have different ideas about what is reasonable. Creditors will usually accept your plan if you can no longer afford your repayments
You will have to demonstrate that you can no longer afford to make your unsecured debt repayments. Your Financial Solutions Advisors will assess your monthly income and essential expenditure, which will show your creditors you can no longer afford to pay all of your debts at the current level of repayments.
If your creditors accept your plan, you can negotiate to reduce your debt repayments to a level that you can realistically afford. All money left over from your monthly income, after essential expenditure has been made, will go towards to repaying your unsecured debts each month.
Note that by reducing the monthly repayments of your debts, your debts will be paid off more slowly which can affect your credit rating or if you are still able to make regular monthly payments.
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