Am I in a DMP or an IVA?
Time and time again I come across people in a particular plan, who are under the assumption that they are in a completely different plan. In my experience this is down to either mis-communication or misunderstanding. When speaking with a company about a plan, it is extremely important to be 100% sure that you are entering into a plan that you understand and it is with a company that you trust.
Often when people are going through the process of setting up a plan they suffer from “information overload” and things can get confusing when trying to deal with such a stressful situation. Regardless of who you choose to assist you with a plan, you should always take your time and not feel pressured into agreeing to go down one particular route without fully assessing your options.
You need to fully understand the plan that you are entering into if you have any questions, no matter how silly they may seem, then ask! Whether it is your case officer at Payplan or elsewhere, then they should take the time to fully answer all your questions for you and make sure you are ready for the plan that you are about to enter.
If you are already in a plan, it should have been clearly and carefully explained to you from the beginning what plan you are in. However if you are unsure you should always speak to the person in charge of you case, whether that be your case officer at Payplan or your case officer from the provider you are with.
Below is a quick reference guide to the differences of a DMP and IVA:
Debt Management Plan (DMP)
- Informal agreement between you and your creditors
- Debts will be repaid in full
- Agreement will last as long as it takes to repay the debts in full
- Attempts will be made to freeze interest and charges, however this can never be guaranteed
Individual Voluntary Arrangement (IVA)
- Legally binding agreement between you and your creditors
- All interest and charges are frozen
- A typical IVA consists of 60 monthly contributions, however depending on your IVA or possible modifications this can be different
- Once your IVA has been successfully completed any remaining debt will be written off
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