A debt management plan allows you to come up with a way of taking control of your existing debts, potentially allowing you to reduce your overall debt and come up with an affordable debt repayment plan.

Debt management plans begin when a debt advisor negotiates a repayment schedule with your creditors on your behalf. This takes into account your current income and outgoings to come up with a monthly payment that you can afford. Provided that your creditors agree to your debt repayment plan, and you meet the required commitments, your creditors will be unable to make any further demands and any debt that you cannot afford to repay could be written off completely.

A debt management plan could also freeze any interest on your existing debts and ensure that you are not charged any late payment fees. A debt management plan may also not affect your credit score in the same way that other debt solutions may, such as an IVA or bankruptcy for example.