- Tue Aug 04, 2015 7:45 pm
This is how it works. It should be the same with any debt management company but I am afraid it does not always happen which is why I am glad you are contacting a non fee-charging debt management company!
You would telephone the Helpline and if it is suitable a financial assessment will be booked as soon as possible. It could be the same day if you have all the information needed to hand.
Once the financial assessment is completed you will be presented with all the options that would be appropriate for you. You then make the decision and if a debt management plan is a suitable option you would be passed through to Payplan Client Services. You will be sent a copy of the financial statement and your list of creditors to confirm this is OK and also a letter of authority without which we cannot contact your creditors. There is also a copy of the terms and conditions of entering a debt management plan and a list of banks for those people who would need to open a safe bank account. You will also receive a telephone call from a case officer who will introduce themselves and who will answer any questions you may have.
Once the letter of authority is received and you are happy with the budget - and let us know of any changes in circumstances - then the creditors will all be sent a proof of debt letter which asks them to confirm the balances on the account. Once all the balances are confirmed - and you as a client can help with that by forwarding any correspondence received - and you have made your first payment (which is distributed), then offers will be sent to your creditors. They should confirm whether the offer is accepted or rejected but whether they accept or not, they will accept your payment which is made on a pro rata basis.
At this point your debt management plan has begun - a lot depends on how many creditors there are and how quickly we can get the balances confirmed which is beyond the control of the debt management company and how a client can help by providing up to date balances. We advise not missing payments but making a payment of as much as you can afford until your first payment into the debt management plan. We do not encourage people to miss payments completely. It can take six weeks but I have seen them set in place much quicker than that. I have also seen them take longer to set up as payments have not been made.
A debt management plan is an informal arrangement between a client and his or her creditors where the debt management company acts as the distributing intermediary. As such it is a gentleman's agreement and all parties are dependent on the goodwill of the creditors as to whether interest and charges will be frozen or futher action taken.
As circumstances can change throughout a plan, you should always let your case officers know how things are progressing as sometimes another solution will become more appropriate as time goes by.
I hope that is helpful.