Debt Management and how Curtis Faraday can help...
A Debt Management Plan is a way to help people struggling with debt get back in control of their finances by reducing their contractual repayments to creditors. Usually if a person is in debt they will probably owe money to many different creditors. A Debt Management Plan is designed to spreading the repayments over a longer period of time, thus making them more manageable.
During a Debt Management Plan we will assign you a professional debt counsellor who will calculate the amount you can afford to pay after giving consideration to your priority debts, for example, mortgage, council tax, utility bills, and other living expenses. Any money remaining after your priority debts have been accounted for is classed as your ‘disposable income’. This money will then be distributed to your non-priority creditors.
Advantages
• Every plan is tailored to meet your individual circumstances.
• We calculate how much you can afford after all your essential living costs.
• You pay one affordable monthly payment for all your unsecured credit commitments. At a date to suit you, whether it is weekly, fortnightly or monthly.
• We negotiate with your creditors on your behalf and request they freeze interest and stop any charges. We deal with all your paperwork from your unsecured creditors.
• You will be assigned your own Account Manager who will be there to support you.
• Each month we will provide you with a monthly statement to enable you to can keep track of your account.
Disadvantages
• A debt management plan could lengthen the time it takes for you to repay your debts, possibly increasing the amount that needs to be repaid, depending on your circumstances.
• Your credit reference file will show details of the debt management plan. This may affect your ability to get credit in the future.
• There is no guarantee that your creditors will accept the reduced payments and/or freeze future interest payments.
• During the negotiation process some creditors may continue to charge interest and other recovery charges. We cannot always prevent these charges being levied. These will however be paid off as part of your Debt Management Plan.
• Entering into a Debt Management Plan will cause you to go into arrears with your creditors.
Debts We Can Help You With
We can help you with many types of debts which are listed below:
Unsecured Credit
• Payday loans.
• Doorstep loans
• Personal loans from bank and building societies.
• Overdrafts.
• Credit card debts.
• Store cards or charge cards.
• Catalogues.
Services that you no longer use
• Disconnected mobile phone bill.
• Utility bills such as Gas, electric or water (from a previous address and supplier).
• Rent arrears (from a previous address).
Shortfalls on repossessed items
If your home, car or other assets have been repossessed and sold, there may be a balance outstanding under the terms of the agreement which you are liable to repay this is known as a shortfall. These debts are no longer secured against the asset and can be included in the Debt Management Plan.
Debts that can’t be included in your Debt Management Plan
Secured Creditors
• Mortgage or other loans secured on the property.
• Hire Purchase.
If you fail to make mortgage or hire purchase repayments the secured asset/assets are likely to be repossessed. An allowance will therefore be made within your financial statement to enable you to maintain these repayments as part of your Debt Management Plan.
Other Excluded Creditors
• Any fine, penalties or liabilities imposed by a court.
• Unpaid child maintence.
• Gas and electricity from your current supplier.
Priority Debts
You need to deal with some debts more urgently than others because the consequences of not paying them can be very serious.
When you enter into a Debt Management Plan you will still be responsible for paying your “Priority Debts” as the law gives creditors different ways of getting their money back. Priority debts include;
• Mortgage or rent arrears from your current address.
• Council tax arrears.
• Gas and electricity with your current supplier.
• Fines, penalties or liabilities imposed by a court.
Debt Management Plan Fees
A large proportion of the work we do for you takes place at the start of the arrangement. This involves the initial consultation, examination of your income and expenditure, and liaison with your creditors to reach an agreeable and affordable repayment plan.
Debt Management Plan fees are:
• Ongoing monthly fees, which are 15% of each monthly payment you make or a minimum of £25 (whichever is greater)
This covers the work involved in setting up your debt management plan as follows:
• Reviewing your monthly payment proposal
• Preparing the financial statement
• Calculating your reduced monthly payments
• Talking to your creditors and negotiating the terms of your debt management plan
Your monthly management fees also pays for all of the ongoing work needed to make your plan succeed including:
• Distributing payments to each of your creditors
• Handling correspondence from your creditors
• Putting together and sending your monthly statements
• Ensuring the monthly payment is affordable to you
* Terms and conditions apply (see below PDF):
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0161 835 2275
