Debt Management

Debts Under £15,000 ?

If your circumstances don’t qualify your for an IVA but you need to reduce your monthly credit repayments – Then a debt Management could be your best option.

What is Debt Management ?

Debt Management is an informal process of negotiation with unsecured creditors to obtain a reduction in the repayment amount and / or a reduction in interest charges.

Negotiation involves providing proof to the creditor you are unable afford current repayments.

How Debt Management Benefits You

  • We negotiate on your behalf reduces your credit repayments to a single, lower monthly amount.
  • We ask your creditors to freeze or reduce interest charges and agree to a lower monthly payment.
  • When interest charges are frozen, the money we pay to your credit companies is taken reduces the debt rather than being used to pay interest charges.
  • You make one monthly payment to us, we forward this to your onto your creditors allowing you to afford your essential bills.

Advantages of Debt Management over a Debt Consolidation Loan.

  • You are about to reduce our outgoings without go further into debt.
  • If you take out a secured Loan – you run the risk of have your property repossessed if you fail to keep up repayments.
  • If you take out a unsecured Loan with a single lender – you are in a weaker position to negotiate should to not be able to make repayment.
  • You will be accepted onto a debt management programme if a bad credit record prevents you from getting a loan.

Advantages of Debt Management over an IVA

  • It’s instant – one call and we can take control of the situation for you.
  • Unlike an IVA, don’t need unsecured debts of £15K or to become involved in a legal insolvency procedure.
  • So long as you’ve 2 or more creditors and can affords to make payments of £100 per month, you will be accepted onto a debt management programme.

Disadvantages of Debt Management over an IVA or Consolidation Loan

  • Unlike an IVA, you payback the full amount of the outstanding debt.
  • Unlike an IVA, you may be on the program for more than 5 years.
  • Unlike an IVA, your creditors may still decide to take legal action against you.
  • Unlike a loan, it does not raise money to pay debts like council tax or a mortgage.

You may find yourself seeking debt advice from a company solely interested in placing you on a debt management program. This is not the case with us as we offer advice on all debt solution alternatives. Only if your circumstances are best suited to debt management will we propose this solution

Frequently Asked Questions.

How much will I have to pay ?
On our advice, you decide on a single affordable monthly payment.

Can you guarantee a reduction in payments ?
No. It depends on your ability to make your current repayment and is at the discretion of the individual creditor. However, once they are presently with proof you are struggling to make payment and are taking steps to pay your debt as best you can, they generally accept our proposal.

How long will the programme last ?
Until all debts have been paid in full. Due to the reduced payment levels, this will be longer than the terms of original credit agreements and may incur addition interest payments as the term of the credit agreement is extended.

How do I know I’m getting the best advice ?
If your circumstances are not best served by a Debt Management programme, we will advise accordingly. This may involve suggesting that we refer you to partner companies offering Insolvency advice, IVA’s or a range of debt consolidation loan.

How do I know my debts are being paid ?
Once up to date balances from your creditors have been received, your monthly payment between them are pre portioned based on how much each is owed. A statement showing how much each creditor will receive will be issued. This remains fixed unless your circumstances change. You will be issued a quarterly statement showing all transactions on your account. In addition to this, you will still receive statements from your creditors.

Will this affect my credit rating ?
When entering into a debt management agreement, you will be breaking the terms of your initial repayment agreement with your lender. This may have an adverse effect on your credit record. Due to time required arranging and distributing payments to creditors and delays in making first payment into the programme from clients, contractual payments to creditors may be missed.

Who administers the Debt Management programme ?
Debt management services promoted by Abacus are administered by Harrington Brooks (Accountants) Limited.

How is the programme administered ?
Negotiations are made with your creditors to reduce your monthly payments. They are requested to freeze or reduce their monthly interest charges. A single monthly payment is taken form yourself and paid your creditors on your behalf. This will make managing payments simpler.

Disclaimer: The material on this website is for general information only and should not be relied upon make important decisions.