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Cleggy
New Member

3 Posts

Posted - 26 Oct 2010 :  11:37:44  Show Profile  Reply with Quote
I've had advice to go on a debt management plan by a couple of different companies so I'm starting to think it's the right way to go.

What worries me is that I keep reading about problems with some debt management companies. How do I know which companies are honest and will do a good job? How can I be sure that a debt management plan is the best advice for me?

Thanks in advance for your ideas.

Phil Corfield
Debt Management Expert



897 Posts

Posted - 26 Oct 2010 :  11:52:26  Show Profile  Reply with Quote
Hello Cleggy and welcome to the forum

You're right to do research on the company you intend to work with as you may be with them for some time to come!

Naturally, given my position, I am biased to who is the best debt management company! However, there are good companies available and in order to help guide you on who to use (or not to use as the case may be), I would recommend visiting http://www.debtmanagementplanforum.co.uk/debtmanagementprogram.php.

All organisations should state as a minimum, their terms and conditions, fees charged, confirm that a full assessment has been carried out with regards to your income and expenditure taking into consideration any priority debts, what service they offer, cooling off period, discuss alternative solutions to you and why they may not be applicable, creditor attitudes, and also inform you that there is no guarantee that creditors will agree to any arrangement.

Finally, I would suggest that you ask the advisors with whom you speak what qualifications and/or training they have that ensures you know that the person with whom you are speaking knows what they are talking about.

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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Beverley Budsworth
Debt Management Expert



251 Posts

Posted - 26 Oct 2010 :  13:16:15  Show Profile  Reply with Quote
Hi Cleggy,

There are a lot of Debt Management Companies operating at the moment, and it can be hard to know who to trust.

The main thing to look for would be companies who are members of either DEMSA (Debt Managers Standards Association) or the Debt Resolution Forum, or preferably both. This way you know that companies have undergone external audits to make sure they are operating in the accordance with the Office of Fair Trading guidelines.

The only way you can be sure that Debt Management is the best advised for you, is if you yourself feel that it is. Don‘«÷t forget, that with a Debt Management Plan, you are not tied in long term, and can always look to move away from this should you feel you are able to cope by yourself.

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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Cleggy
New Member

3 Posts

Posted - 26 Oct 2010 :  13:21:10  Show Profile  Reply with Quote
Are there any obvious warning signs that I should watch out for with the bad companies?

Thanks for the answers by the way.
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Beverley Budsworth
Debt Management Expert



251 Posts

Posted - 26 Oct 2010 :  16:36:46  Show Profile  Reply with Quote
Hi again Cleggy,

One thing to look out for is companies that are guaranteeing to get offers accepted with your creditors, and get all interest or charges stopped.

While most creditors will liaise with debt management companies, they will always need to review all of your circumstances before entering into any reduced payment arrangement.

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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James Falla
Debt Management Expert



277 Posts

Posted - 27 Oct 2010 :  17:22:08  Show Profile  Reply with Quote
Hello Cleggy

I agree with Beverley. You should definitely be suspicious of any debt management company advisor who tells you that they can guarantee to write of debt or get interest charges stopped. Your creditors are not legally obliged to do this unless you enter into an IVA.

I would also suggest choosing a company where you are given a named advisor who knows you and whom are always able to contact. This is generally more usual with smaller firms.

Ultimately as with any service company, the best advice is to speak to 2-3 different suppliers and then go with the one you feel most comfortable with.

Personal Debt Expert
BeatMyDebt.com
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Cleggy
New Member

3 Posts

Posted - 27 Oct 2010 :  19:26:51  Show Profile  Reply with Quote
Most of my debts are with HSBC and MBNA though there are a few smaller ones these would be the main ones. Are they OK with debt management plans?

Sorry to keep asking questions but I want to be as sure as possible about what I'm doing.
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Phil Corfield
Debt Management Expert



897 Posts

Posted - 28 Oct 2010 :  15:34:40  Show Profile  Reply with Quote
Hi Cleggy

MBNA are usually fine with debt management plans and their process is typically smooth.

HSBC are on the other hand not as straightforward and have trialed a few different systems over the last two years and as yet none seem to have been "set in concrete".

They have recently created a process where, if the proposal is accepted by them, then there will be no letter confirming this. A letter will only be received from them if they reject the proposal. This is their current process, but again may change in the future.

What I would say though is, a debt management plan is for you, not your creditors. If you're struggling to make payments and a dmp is the only option open to you, following qualified advice, then HSBC's reaction should not deter you from entering into one.

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:
   

Edited by - Phil Corfield on 29 Oct 2010 09:00:13
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James Falla
Debt Management Expert



277 Posts

Posted - 28 Oct 2010 :  16:15:14  Show Profile  Reply with Quote
Hi Cleggy

The most important thing is to make sure you consider all the debt management options and choose the one that is right for you rather than worrying about what your credtors will or will not say. The way to do this is speak to 2-3 different companies, weigh up what they say and go with the one you feel most comfortable with.

If having taken advice, you feel a debt management plan is the right solution, then you should stick with this. If you make the best offer of payment that you can then there is very little more you can do.

In terms of MBNA, you will need to be sure that you keep within their accepted expenditure guidelines. If you are unable to do this, they do tend to be more difficult about stopping their interest charges.

Personal Debt Expert
BeatMyDebt.com
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