Repayment Arrangement

A Repayment Arrangement is an informal agreement between you and your creditors, allowing you to make affordable payments based on your financial situation.

How does a Repayment Arrangement work?

With a Repayment Arrangement, you work directly with your creditors to agree on a payment plan that suits your budget. As it’s an informal solution, you’ll have flexibility when it comes to increasing or decreasing your monthly payments if you need to, but it’s best to agree this with your creditors.

Assessing your budget and debts

• We’ll review your financial situation to help you work out a realistic repayment amount.

Finding the right solution

• If a Repayment Arrangement is the best option for you, we’ll send you a comprehensive guide which talks you through all the next steps.
• You’ll then be responsible for contacting your creditors and agreeing on a repayment plan directly with them.

Am I eligible for a Repayment Arrangement?

A Repayment Arrangement may be a suitable option for you if:

• You need more manageable payments: A Repayment Arrangement can help you structure your payments to fit your budget.
• You owe money to multiple creditors: If you’re dealing with several creditors, a Repayment Arrangement can give you a clear plan to follow.
• You need a short-term solution: If you’ve experienced a temporary change in circumstances, a Repayment Arrangement can provide the breathing room you need.

What are the pros and cons of a Repayment Arrangement?

Benefits of a Repayment Arrangement

• More Affordable Payments: A Repayment Arrangement helps you create a plan where you pay what you can realistically afford.
• Interest & Charges May Be Frozen: Creditors may agree to reduce or stop interest.
• Short-Term Flexibility: Ideal for temporary financial difficulties.
• You Stay in Control: You have control over your repayment plan, and you can adjust payments if your situation changes.
• No Formal Debt Process: Avoid possible restrictions involved with some legally binding solutions.

Things to consider

• Credit Impact: A Repayment Arrangement may affect your credit score and appear on your credit report.
• Creditor Approval Needed: Creditors must agree to the repayment plan, and some may not accept it.
• Not Legally Binding: Creditors can still take legal action.
• Ongoing Payments: You’ll need to make regular payments until the agreed amount is repaid.
• Self-Managed: You arrange payments with each creditor, which can take time.
• Not Ideal for Long-Term Debt: It is not the best solution if you need a long-term plan.

What debts can be included in a Repayment Arrangement?

A Repayment Arrangement can cover most unsecured debts, such as:

• Bank loans
• Overdrafts
• Credit cards
• Payday loans
• Council tax arrears

Certain debts – like mortgages, car loans, court fines and child maintenance – should be paid in full where possible.

Not sure if a Repayment Arrangement is right for you?

Get free debt advice online or call 0800 316 1833 to speak to one of our experts. We’ll explain the solutions available, check what you may be eligible for and help you choose the option that best fits your situation.