Debt Advice Questions
What is a debt management plan?
A debt management plan is an arrangement between you and your creditors to repay your debt at more affordable payment in line with your individual circumstances.
What will Back 2 Credit do for me?
When you agree to start a debt management plan with us we will negotiate for a reduced monthly payment proposal on your behalf. At this point we may also be able to stop or reduce interest and charges being applied on your account. Therefore, every payment you make will actually go to clear the outstanding balance with your creditor.
Will I still need to deal with my creditors?
Normally, once a debt management plan has been agreed between you and your creditors the calls and letters do cease as long as the payment proposal is kept to. However, sometimes you may still get calls and letters – but just pass them directly to Back 2 Credit and we will handle them for you.
Do I have a point of contact after I sign – as my creditors did not want to know after I borrowed the funds?
You will be appointed a personal debt advisor from day one and they will be your point of contact and will liaise with your creditors on your behalf. You will have their direct number and they are there to assist you with any queries throughout the duration of your relationship with us. Unlike other debt management companies we will not give you a high rate number to call after you have signed – rest assured.
How does a debt management plan work?
- Go through your income and expenditure (calculate your debt)
- Establish what you can realistically offer your creditors on a monthly basis – this amount is what is left after what is deemed essential expenditure i.e. mortgage/rent, utility bills and housekeeping.
- Once you have agreed to the payment proposal, your finance manager will begin to negotiate with your creditors.
- Onwards you pay one single monthly affordable payment to us and we will distribute on your behalf and take care of any communication you receive regarding your personal debt.
How long will it be till I am debt free?
This is dependent on your individual circumstances – how much you owe and how much you can afford to pay each month towards your outstanding balances. This will be a longer period as you are paying less than originally agreed.
However, your personal debt adviser will go through a realistic affordable payment plan and as you are now only paying one single monthly payment – you will incur less bank charges and interest for no good direct debits etc so we will aim to get you back on track in the shortest possible time. As debts get paid off your payment will be re-distributed to your remaining creditors.
What happens if my circumstances change?
Let us know – and we will go through your income and expenditure again and re-negotiate on your behalf again. We will carry out six monthly reviews of your circumstances change as normal practice anyway. We are only a phone call away.
What if I’m weekly, fortnightly or 4 weekly paid?
Don’t worry – you can pay us in line with your salary frequency this will not affect how we handle your plan. The plan will be tailored to your individual needs.
Is a debt management plan the right solution for me?
This may not be the debt solution for you – there may be alternatives solutions like an IVA but talk to a personal debt adviser who will talk through your options.