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Starting Member

1 Posts

Posted - 16 Sep 2011 :  11:13:38  Show Profile  Reply with Quote
I've heard the living allowances for a debt management plan are so tight it's not worth doing. Is this the case?

I have a hobby that costs money and if it can't be accepted in the debt management plan, what else can I do?


Beverley Budsworth
Debt Management Expert

251 Posts

Posted - 16 Sep 2011 :  12:30:06  Show Profile  Reply with Quote
Hi NeoMatrix, welcome to the forum,

A debt management plan is a solution to help people who are struggling to maintain payment to their creditors.

As you are asking your creditors to reduce your payments, they will ask that you show a commitment to pay a fair offer based on sensible living costs.

If your hobby is costing you a lot each month, creditors may see this as non-essential expenditure that should be made towards your debts.

How much is your hobby costing you? Also how much are you paying towards your debt each month and how much do you owe in total?

This information will help a bit further to assess your situation.

I am a Insolvency Practitioner and Managing Director of The Debt Advisor. To contact me about Debt Management Plans, IVA's or general debt advice please click here:
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Phil Corfield
Debt Management Expert

897 Posts

Posted - 16 Sep 2011 :  12:32:39  Show Profile  Reply with Quote
Hi NeoMatrix & welcome to the Debt Management Plan Forum.

The allowances or guidelines as they're more commonly known in insolvency are usually just that - guidelines. In a debt management plan, these are still used but there is more flexibility to be had than say in a bankruptcy or IVA (Individual Voluntary Arrangement).

Whatever your expenditure is, it can be recorded for a debt management plan, as this is an informal insolvency option. This means some creditors may accept it, some may not. It then really comes down to what options the creditor has to pursue and which of these options they then choose to take, such as court/legal action, pass the debt to a debt collection company, continue to charge interest and/or fees and so on.

Can I ask how much debt you have, and what kind of money are we talking about that goes towards your hobby?

I am a CertDR qualified Debt Advisor and a Director of Bright Oak.
To contact me about a debt management plan or general debt advice please here:
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James Falla
Debt Management Expert

277 Posts

Posted - 16 Sep 2011 :  13:03:49  Show Profile  Reply with Quote
Hello NeoMatrix

In order to gain agreement from your creditors for a debt management plan you need to stick to a reasonable living expenses budget. It is all about give and take. If the creditors do not think you are making enough effort to pay them, then they will not be so inclined to agree your payment proposal and freeze their interest charges / suspend further action againt you.

Having said that a debt management plan living expenses budget will normally allow you some room for spending on your hobbies. There are some living expenses guides in the web which you can look at to get a feel of the budgets your are allowed. Search on "debt management plan living expenses guide" and they should come up.

Personal Debt Expert
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