A Debt Management plan is a debt solution for anyone who has unsecured debts that they can't afford to repay. A DMP requires you to have a surplus income each month (money left over after you have paid all of your living costs and household bills from your income) and owe money to more than one creditor.

• You pay one monthly payment to Payplan who distribute all of your payment on a pro-rata basis to your creditors (Payplan don't charge any fees for administering a DMP)
• Interest and charges are often frozen, so the debt doesn't increase.
• You only pay what you can afford, based on your incomings and outgoings.
• You will no longer need to negotiate with your creditors alone.
• With Payplan you can track your monthly payments online using our exclusive Justabank website.

Whilst creditors may still write and call you, Payplan encourage them to contact us instead. This can often reduce the number of calls and letter.

• It isn't legally binding, so creditors can proceed with court action (although Payplan will assist you with this should it ever occur)
• If you are only making a small monthly payment and have a high level of debt, it could take several years to clear your debt. (Payplan will recommend all alternative solutions if this is the case)

No, a debt management plan is exactly what it says, a way to help manage your debts. A Debt Management Company doesn't buy the debt from your original creditors nor do they give you money to cover your existing debts. Payplan help you to manage your debts by offering a reduced payment to each of your creditors and then negotiate to freeze interest and charges.

The length of your DMP depends on your individual situation. It also depends on your level of debt and monthly surplus. If creditors freeze interest and charges, the length of the DMP can be dramatically reduced. For example: If you owe £25,000 and you can afford to pay £250 per calendar month the DMP will last for just over 8 years (100 months). This applies only if the payments are maintained each month and the creditors freeze interest for the duration of the plan. Your DMP can be completed sooner if your circumstances improve and your payments can be increased.

Nothing, its completely free. There are, however many debt management companies that charge by either requiring a start up fee or a monthly management fee, which can be anything from 15% - 17% of the monthly payment. Payplan are funded by the credit industry, which allows us to offer completely free debt management plans. This means whatever you can afford each month goes directly to your creditors to reduce your level of debt. For example if you can afford to repay £250p/m all of that money will be distributed to your creditors pro rata, Payplan takes nothing out.

This depends on your surplus income (i.e. money you have left over every month after paying all your living expenses) and how much you owe each creditor.

For example:

We will pay the agreed amount each month to each of your creditors, on your behalf, with no fees taken out.

You can pay either weekly or monthly using one of two methods:

• Standing Order (this is the easiest and preferred method)
• Cheque

You are, of course, free to stop the DMP at any time, but we ask that you provide notice so we can inform all of your creditors.

If you are experiencing further financial problems and cannot afford the payments to Payplan, please let us know, we may be able to restructure the plan for you.

Please note: Once the plan is cancelled, creditors may resume interest and charges.

On of the benefits of a DMP through Payplan is that we will contact your creditors, explain your situation, show them your income and expenditure and make an offer of payment to them. This helps to alleviate the stress involved for you.

Creditors don't actually have to agree to the payments in order for you to send them the money. You can only offer what you can afford and no more, the creditors know this but can use common phrases to try and get you to increase your payment.

Due to Payplan's reputation in the credit industry, many creditors accept our offers, as they know we work to realistic guidelines.

A DMP will not show on your credit file, however, if you are in financial difficulty your credit rating is likely to have been affected already. Whenever the full contractual payment isn't made, whether this is through a DMP or not and even if the payment is just a few pounds short, it will still affect your credit rating as you are not complying with the credit agreement. Payplan can help clear your debt quicker by negotiating for interest and charges to be frozen, so your credit rating may be affected for a shorter period.

Unfortunately your creditors are still entitled to contact you directly so Payplan cannot guarantee that all letters and phone calls will stop immediately, but we can get them down to a minimum and once the DMP is well established they should stop altogether. All correspondence you receive from your creditors whilst in a Payplan arrangement should be sent to your case officer to deal with.

Payplan have an exclusive website for tracking your payments called Justabank. This website allows you to view the payments we have received from you. You will also be able to track individual payments to each of your creditors and confirm exact dates. Once you enter into a Payplan arrangement your personal case officer will give you your login details so you are able to track your payments.

Creditors may occasionally contact you to say that they haven't received a payment from Payplan, which is often untrue; they may be asking you for more money directly, or there may even be a misunderstanding between departments. If you ever suspect your creditors aren't being paid or that a mistake has been made, then you should get in touch with your case officer via their direct line or by contacting Payplan online.

Payplan pride's itself on giving excellent support to clients. Throughout your Payplan arrangement you will have a case officer who will give you a direct number and an email address so you can keep in contact. If your financial situation changes, you can talk to your case officer who will try and arrange a new plan for you. Our members of staff are always there to give support and answer any questions you may have. Our website will also give you continuous support, with hundreds of pages of technical knowledge, money saving tips, up to date relevant news and Justabank.

We ask clients not to obtain further credit whilst in a DMP. It can be considered fraudulent to take out credit that you know can't be repaid. The debt management plan will make sure you have enough money to live on, so you shouldn't need to take out any more credit. There are of course exceptions, such as a company credit card where you are not liable for the payments, but you should declare these to your case officer to avoid any problems.

Creditors aren't obliged to freeze interest and charges and Payplan cannot guarantee this. However, if you present a realistic income and expenditure to your creditors through a DMP with Payplan, then you stand an excellent chance of achieving this. Payplan has a good reputation with creditors for establishing realistic and workable DMPs, and creditors can be more cooperative when they see that the debtor is making every effort to clear their outstanding debts.

Your secured debts i.e. mortgage and car HP can't be included in a DMP, if you are unable to make the contractual payments to your secured debts you are at risk of losing the item to which the loan is secured on e.g. a car or house. Payplan will ensure you include your secured debt repayments in your income and expenditure. You should never get into arrears with your secured debt and Payplan strive to help you do this when you are in a DMP. Mortgage Arrears, Car Repossession, House Repossession .

No, a DMP is an alternative to bankruptcy and isn't legally binding so you won't lose your home if you continue to make the agreed payments into your DMP. It is always our priority at Payplan to ensure that your property is not at risk and allowances will be made within your income and expenditure to keep up the payments on any mortgages or loans secured on your property. Providing you do this then there is no reason why your property should be at risk.

A DMP will only help you make reduced payments to your unsecured creditors, therefore the debts that can be included are:

• Personal loans (loans taken to purchase cars are fine but Hire Purchase (HP) agreements cannot be included)
• Credit cards
• Store cards
• Catalogues
• Overdrafts

Secured debts can't be included in DMPs because any payments on secured debts that aren't met in full, can lead to the goods being repossessed. This website provides details on house repossession and car repossession, which are all consequences of not maintaining mortgage or hire purchase payments.

Payplan will never force you to tell your partner about your debt situation, although support is available if you wish to tell them. We take great care to avoid divulging the nature of our call to anyone but the client.

To enter into and maintain a successful DMP you will need to live within a budget, however this is discussed with you openly. Payplan are required to submit your income and expenditure details to your creditors. It is in your interest to show your creditors you are prepared to make some sacrifices to help repay your debts.

If you have a current account with a company you owe money to, you will be required to open a new bank account. This is not only the case with a DMP but you should change your bank account if you are going to make reduced payments to a company that you also bank with. Banks have the Right to Offset so any money in your current account could be used to pay another debt with the bank.

As a DMP isn't legally binding creditors could still take action against you. As Payplan have many years experience and have a great relationship with the creditors this is less likely to happen. However Payplan would continue to support you if any of your creditors applied to the court for a CCJ. Even if a creditor applied to the court for a CCJ the payment should remain similar to what you are paying through Payplan.

By entering into a DMP, your creditors can issue a default notice as you are defaulting on your original credit agreement. If you receive a default it doesn't automatically mean the creditor is going to take legal action. The default will appear on your credit file for 6 years from the date it was issued.

CCJs don't prevent you entering into a DMP; Payplan will help you make the payments to creditors who have issued you with a CCJ. You will be required to provide details of your CCJ during your financial assessment. CCJ payments will be given priority when Payplan distribute your payments monthly.