What is a Debt Management Plan?

A Debt Management Plan is an agreement between you and your creditors to pay all of your debts in full.

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Step 1 - How much do you owe?

Less that £5,000
£5,000 to £20,000
More than £20,000

Debt management plans are useful if:

  • You can afford to pay something towards your debts but can’t afford the full payments your creditors are expecting
  • You have debt problems but are unable to afford the full repayment for a period of time
  • You do not want to enter a formal solution
  • You are struggling to keep on top of your current repayments and need to re-structure to regain stability

You can arrange a plan with your creditors yourself or through a licensed debt management company for a fee. If you arrange this with a company you make one repayment to the company and they divide the money to your creditors.

You may incur charges or fee’s from a company to set up a debt management plan however there are some free services you can find through the Money Helper service, their details are provided at the bottom of the page.

A debt management plan is an informal solution and it aims to put all of your existing creditors ideally into one monthly manageable payment for you.


  • One affordable payment to the Debt Management Plan company.
  • The amount you’re paying can be changed if your situation changes.
  • Creditors can sometimes freeze interest however they do not have to do so.
  • Certain organisations will do this free of charge you can contact Money Helper for more information on this.
  • The DMP provider will negotiate with lenders on your behalf.
  • A DMP can be used as a short-term solution.


  • For the DMP to be effective all creditors must agree to the arrangement offered.
  • Most providers will charge a fee for this service which may vary depending on the provider.
  • Interest and charges are not guaranteed to be frozen.
  • Your credit rating will be affected.
  • In order to repay your debt in full whilst also making reduced, more manageable repayments, the term of the agreement may be longer or the total amount repayable higher.