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Debt Management

Debt management plan is an arrangement which allows you to consolidate all your debts into one simple monthly payment. It may be possible to freeze the interest on your debt, which will enable you to reduce the total amount you owe. Also, you would not have to deal with the creditors yourself.

Pros

Cons

	Have one monthly payment which is affordable for you.
	Possibility of interest frozen.
	We deal with your creditors on you behalf.
	Regain control without tying to borrow your way out of debt.
	No more late payment charges
	Peace of mind.

	Your credit rating may be affected

	There is a possibility your interest may not be frozen

Case Study

Mr Derek ABBOTT from Sheffield, Yorkshire, had unsecured debt totalling £13500, he was paying back nearly £1200. When he started a DMP, his payments were reduced to one affordable monthly payment of £279 per month.

IVA - Individual Voluntary Arrangement

An Individual voluntary arrangement (IVA) enables you to avoid bankruptcy by making a formal agreement with creditors to pay off a percentage of your debts over a fixed period. An IVA often appeals to debtors who wish to avoid bankruptcy and its associated penalties. It also gives the debtor more control over how assets are dealt with and increased peace of mind that no further debts will accrue.

Pros

Cons

	Debt Free in 5 years.
	Telephone calls & payment demands stopped
	Interest & late payment charges frozen
	Single monthly repayment
	Repaired credit history & legally binding contract
	Protection from court action

	Possible release of home equity
	Minimum level of debt
	No unsecured borrowing during the arrangement
	Adverse credit rating
	Longer than bankruptcy and you pay more back
	You must include all creditors