DMP case study
A DMP enables you to pay off your unsecured debts in full at a much more affordable rate. Here’s how PayPlan helped a client with over £30,000 of credit card debt to get on the path to becoming debt free.
Matthew, single, aged 27
Matthew works for an engineering company earning £19,000 a year, and lives in his solely mortgaged property. For the past five years, Matthew subsidised his monthly pay packet by using credit cards and overdrafts, to give him some extra spending money each month. While he hasn’t bought luxury cars or expensive holidays, he has simply been living beyond his means for some time, resulting in the build up of £31,000 of debt across six credit cards.
The monthly credit card payments were manageable for him while he was bringing in a consistent wage, particularly as he was also earning bonuses whilst on-site. Following a knee injury, however, he was forced to take two months off work, resulting in him falling behind with repayments to his credit cards. Following his return to work, Matthew tried to catch up on his arrears, but found that to clear these, he needed to pay £853 per month, which was simply not affordable to him.
As the months went by and Matthew was unable to clear his arrears, the credit card companies continued to add further interest and charges for exceeding his credit limits. Matthew started to feel out of his depth, and decided to approach PayPlan for help.
PayPlan’s expert debt advisors reviewed his situation and identified that a Debt Management Plan would be the best debt solution for him . Having completed his monthly budget to ensure his priority payments could be paid from his wages first, PayPlan identified that he could afford to pay a total of £450 each month.
PayPlan approached the credit card companies and negotiated the terms of a DMP with them. Most of the companies also agreed to freeze the interest that was being charged. Matthew now pays £450 per month by standing order to PayPlan just after he is paid each month. If he keeps up these repayments, Matthew now has a genuine chance of becoming debt-free within six years.
To find out how PayPlan can help you to get out of debt and to start enjoying life again, contact our experts by calling FREE on 0800 316 1833 from 8am to 8pm Monday to Friday, and 9am to 3pm on Saturday, or complete our online enquiry form and we will get in touch.