• An initial fee to cover the cost of setting up your plan. This could be equal to a couple of payments.
• An administration fee may be charged to cover the cost of processing your plan.
• A monthly fee to oversee your plan.

Money Down the Drain

The above costs are money in the Debt Management Companies back pocket and so less money is going towards your debt. Less money going towards your debt means you will be in debt for longer. These Debt Management Companies will say they can freeze interest and charges. It’s true they might be able to but so can Payplan or StepChange. This big difference being Payplan and StepChange don’t charge you for their service. This means every penny you pay goes towards your debts.

Other Issues with Paying for Debt Management Plans

There have been some companies taking their clients money and not making payments on their behalf. These companies have then ceased to exist leaving their clients out of pocket and still in debt. It must be heart breaking to find out you have been making all these payments and then suddenly be told the money hasn’t gone towards your debts. Not all fee charging Debt Management Companies are bad but this type of event still happens. With Payplan or StepChange you know you are safe, they have been around for a long time and are secure.

How do these organisations survive?

They get their funding from the very people you owe money to. It makes sense as those companies are more likely to get what they are owed back when you get help with your debts. Payplan and StepChange are well regarded in the credit industry and most creditors will accept repayment proposals from them. Most creditors will also freeze interest and charges.

Getting your Free Debt Management Plan

If you decide you no longer wish to pay for a Debt Management Plan, and nobody can blame you, then please visit the Debt Help section on this site. From there you can find the information for StepChange and Payplan and visit their websites to find out more. Good luck.