DMP FAQs

A Debt Management Plan (DMP) is an informal arrangement with your creditors where you make one affordable monthly payment to pay off your unsecured debts.

A DMP could be a good choice if you have unsecured debts like credit cards, loans or overdrafts that you find hard to pay each month. If you have money left after covering your living expenses and any priority payments, a DMP can help you regain control of your finances without the need for a formal debt solution.

There isn’t a one-size-fits-all debt solution so it’s important to understand if a DMP is the right option for you. This is something we can help you with – we’ll make sure you know all the different ways you can handle your debts, so you can make the best choice for your situation.

Every debt situation is unique. A DMP is one of several debt solutions available, but it may not be suitable for everyone. We’ll guide you through all the options available to you to help you find the best approach for your circumstances.

Nothing—a DMP with PayPlan is completely free. Everything you pay goes towards your debts. There are no other monthly costs or set-up fees.

Be aware that some other providers charge fees for setting up and managing a DMP, so it’s important to make sure you understand these before starting one.

It depends on whether your creditors agree to freeze interest and charges in your DMP. We’ll always request this for you, and although it’s not guaranteed, the majority do agree to do this.

It’s possible to get a mortgage during and after being in a DMP, but there will be certain restrictions on what you can get in terms of the amount you can borrow and the interest rates you’re offered.

Yes, it’s possible to get a mortgage or remortgage during and after a DMP, but there will be certain restrictions on the amount you can borrow and the interest rates you’re offered.

If you’re keeping up with your regular rent payments and repaying any arrears, a DMP shouldn’t affect your current tenancy. However, if you’re planning to move to a new rental property, landlords or letting agents may review your credit file. Some will ask for your consent to run a credit check, which could inform them that you’re in a DMP. This might raise concerns about your ability to pay your rent, however, not all landlords run credit checks, so it’s still possible to rent a new property. If there are any concerns, offering a guarantor might help secure the tenancy.

Your DMP will be based on a realistic budget that covers your essential expenses like rent/mortgage payments, utilities and groceries. We’ll help you create this and review this every year to make sure it’s still realistic for you.

You can contact us any time you need to update your budget, and you’ll have peace of mind knowing that you’ve got enough money to run your home, pay for your household costs, and pay your essential bills.

No, your employer won’t be told if you decide to enter into a DMP. It’s an informal plan and isn’t legally-binding, so there’s no public record of it. It’s only if your employer performs a credit check that they may see markers or defaults on your credit file that indicate you’re in a DMP.

The length of your DMP depends on how much debt you have and the amount you can pay back each month. It’ll last until your debts are fully paid off, and we’ll review your DMP with you and update you on your progress every year.

Yes, you can cancel your plan at any time, but ending your plan will mean that you lose the support it offers you. This could lead to your lenders adding interest and charges to your accounts and taking legal action against you to recover what you owe. It’s very rare, but there is a possibility that they may choose to issue a Bankruptcy Order against you.

We won’t charge you a fee for cancelling your plan. If we’re holding any of your money in your accounts, we’ll refund this to you in full as soon as possible.

No, your DMP is completely confidential and, as it’s an informal agreement, there won’t be any public record of you starting one either. We’ll never ask you to tell your partner about your DMP and we won’t share any information without your explicit consent. However, it’s important to be mindful of any joint debts you might have. If you have a joint debt and it’s included in your DMP, your partner may become aware of it as creditors may contact them regarding missed payments.

Setting up a DMP is a straightforward process. First, you’ll chat with one of our advisors, either on the phone, over WhatsApp, or on Live Chat. Together, you’ll create a budget to determine how much you can realistically afford to pay towards your debts.

If a DMP is an option available to you and you choose to go ahead, we’ll talk to your creditors and tell them how much you’ll pay to them each month through your DMP.

You’ll only need to make one payment to us each month, and we’ll take care of the rest. We’ll fairly divide the money between the companies you owe money to.

Throughout your plan, you can easily check the details, send messages and monitor your progress online using PayPlan Plus.

Setting up your DMP is quick and straightforward, typically taking just a few days depending on how soon you can provide the required information and make your first payment.

We’ll help you create a budget which includes all of your monthly income and expenses, ensuring all essential living costs and priority payments are covered first. The remaining amount will be your monthly payment towards your DMP. We’ll review this every year or whenever your circumstances change to ensure your payments remain affordable.

There are multiple options to choose from when it comes to making your monthly payment into your DMP. The easiest and most convenient method is setting up a monthly direct debit, but you can also pay via Standing Order, debit card or bank transfer.

If you’ve missed a debt when setting up your DMP, we can add this on – remember, adding another debt will impact your monthly payment amount and the estimated repayment timeline.

Pros:

• Means you can make one affordable monthly payment rather than multiple payments to pay off your debts
• A DMP with PayPlan is completely free – everything you pay goes towards your debts
• Creditors may freeze interest and charges

Cons:

• As you’ll be making reduced payments, this will have an impact on your credit score (any markers, notices or defaults applied to your accounts will show for six years), although your credit score may have already been impacted if you’ve missed payments
• It’s not guaranteed that all companies you owe money to will freeze interest and charges
• There’s no legal protection from creditor action and creditors can still contact you if they choose to

An advisor can explain all of the details of a DMP and answer any questions you may have.

Although going into a DMP isn’t guaranteed to stop bailiff action, it does indicate to your creditors that you’re trying to get on top of the debts, which may prevent them from taking further action. If you’re worried about possible bailiff action, we’re here to support you and help with any questions you have.

Because a DMP is an informal agreement, it doesn’t need approval from your creditors to go ahead. As part of your set-up process, we’ll contact your creditors with your proposed repayment offers, and they have the option to accept or reject them.

We’ll keep you updated on the outcome of each, including whether any creditors agree to freeze interest and charges. Based on our extensive experience working closely with creditors, we’ve found that they’re often willing to cooperate when they see you’re actively taking steps to manage your debts through a DMP.

A DMP will include all your unsecured debts. Examples of these include credit cards, overdrafts, loans and water arrears.

You’ll need to continue to pay any priority payments that can’t be included in your plan, such as rent/mortgage arrears, hire purchase payments and council tax.

As it’s an informal solution, a DMP doesn’t provide legal protection for your assets, however the budget created as part of your DMP will prioritise payments you need to make to anything you own.

No, we don’t buy the debt from your original creditors, or give you money to pay off your debts. A DMP allows you to repay your debts at an affordable rate by setting up an informal arrangement with your creditors to make a reduced monthly payment. Some creditors may also agree to freeze interest and charges, helping you to get debt-free more quickly.

No, a DMP is an informal debt solution to help you manage your existing debts in a more manageable way.

Yes, when we’re setting up your DMP, let us know if you have a CCJ and we’ll make sure to prioritise a payment to this within your budget to make sure you’re keeping up with your agreement.

Yes – there are some alternative debt solutions available to Scottish residents, though, which we’ll take into consideration when looking at your circumstances and deciding the best course of action for you.

You’ll have our support every step of the way. Once you start your DMP, you’ll be looked after by our support team, who can help with any queries you have. They’ll keep in touch throughout your plan and complete a review with you every year.

Your plan will be reviewed every year. You should also notify us whenever your circumstances change so that we can review your budget.

DMPs can include unsecured debts like credit cards, loans and overdrafts. Secured debts – such as mortgage, rent or utility arrears – would be classed as ‘priority’ debts and wouldn’t be included in your DMP but would be factored into your budget so you can pay them separately each month, whilst still having enough left over to live comfortably and make your monthly DMP payment.

In a DMP, we’ll ensure mortgage payments are prioritised within your budget, so you don’t fall behind. This allows you to keep up with your payments each month, as your monthly payment into your DMP is calculated based on what you can afford after essential costs like these are paid.

If you do happen to miss a mortgage payment, please let us know as soon as possible so we can adjust your budget to prioritise any arrears.

You won’t have to sell your car in a DMP. You’ll have enough money to pay for the running costs of your car and keep it roadworthy. If your car is on a finance agreement, your budget will prioritise your car payment, which you’ll need to continue paying outside of your DMP.

A DMP can help you clear your debts by allowing you to make one affordable monthly payment until the debts are paid off in full. Most creditors will agree to freeze interest and charges whilst in a DMP, to prevent the debt from increasing while you’re trying to pay it off.

As soon as we receive your Letter of Authority (LOA) as part of your DMP set-up, we’ll let your creditors know. We’ll explain the situation to them, share your budget, and make a repayment offer to each of them. We’ll check in with them every year or whenever anything changes to let them know of any updates and to share your progress.

If your circumstances significantly change, such as your name or address changes, you’ll need to let your creditors know so they can update their records.

We’ll split your monthly payment to your DMP fairly between the companies you owe money to. This means that they’ll receive a percentage of your payment based on how much you owe. So, the companies you owe the most to will receive a larger share.

As a DMP is an informal arrangement, your creditors can still contact you directly. However, we find this normally reduces throughout your plan.

You’ll still receive automated communications (like letters and emails) from them, and there are some things they legally still need to send you, like Annual Statements or Default Notices.

If you receive documentation or contact from creditors that worries you, let us know, and we will help.

Your creditors are likely to contact you still initially, but this should die down after a few months once they’ve updated their systems. You can let your creditors know we’re dealing with your debts and provide them with your PayPlan ID for reference. You’ll still receive important information about your accounts that they’re legally obligated to send you.

You can log in to your PayPlan Plus account anytime to see your payment history. This shows the exact details of any payments you’ve made to us and payments we’ve made to the companies you owe money to on your behalf.

The companies you owe money to might contact you to say they haven’t received a payment. This could be an error on their system, or it could be taking some time for their system to update since starting your plan. However, some may ask you to make an additional payment outside of your plan. If they contact you to say your payment has not been made, simply contact us, and we’ll speak with them and investigate it for you.

DMPs aren’t legally binding, so the companies you owe money to can still choose to take action against you to recover what you owe. In our experience, this is unlikely to happen if you keep up with the monthly payments to your DMP.

If one of the companies you owe money to applies to the court for a CCJ, we’ll support you in managing this.

Yes, it’s simple to move an existing DMP to us. You can call us free on 0800 316 1833 or fill out our online form. We’ll assess your debt needs, ensure we recommend the best debt solution based on your current circumstances, and, if that’s still a DMP, set it up and administer it for free.

Don’t worry; you can simply move your DMP to us instead. Call us free on 0800 316 1833 or fill out our online form. We’ll assess your debt needs, ensure we recommend the best debt solution based on your current circumstances, and, if that’s still a DMP, set it up and administer it for free.

In a DMP, you’ll be making reduced payments, which will impact your credit score. Any markers, notices, or defaults applied to your accounts will show for six years. It’s important to remember, though, that your credit score may have already been impacted if you’ve missed or made payments less than the contractual amounts.

Any markers, notices or defaults applied to your accounts will show for six years.

Taking out credit that you know can’t be repaid can be considered fraudulent, and it would be irresponsible of us to support you in taking out further credit.

The DMP that we arrange for you will ensure you have enough money to live on, so you shouldn’t need to take out any more credit. There are some exceptions, including mortgage payments and HP agreements.

While in a DMP, you’ll be making reduced payments which will have an impact on your credit score. Some creditors may issue a Default Notice, cancelling the original agreement you had with them. If this happens, let us know as soon as possible so we can support you in managing this. Any markers, notices or defaults added to your accounts will remain visible for six years. It’s important to remember, though, that if you’ve previously missed payments or made payments below the required amount, your credit score may have already been impacted.