Money Wellness

Looking for a DMP?

(Debt Management Plan)

If you are looking to lower your monthly payments our free debt management plan (DMP) may be a way to do this.

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What is a debt management plan?

A debt management plan (DMP) is an agreement to pay off your debts at a rate you can afford. It’s an informal agreement between you and your creditors to give you longer to pay back your non-priority debts (credit cards, loans, store cards, buy now pay later etc.)

You make one affordable monthly payment and this is divided between your creditors. If you come to us for your DMP, we’ll deal with your creditors for you.

A debt management plan is not legally binding. This means you can cancel it at any time.

Woman on the phone

We don’t charge fees for our debt management plans. This means all the money you hand over will go towards paying off your debts. 

Most non-priority debts can be included in a debt management plan. A debt is classed as either priority or non-priority depending on how serious the consequences are if you don’t pay.   

The consequences of not paying non-priority debts are less serious than for priority debts. Despite being less serious, your creditors could still take you to court or arrange for bailiffs to visit you.  

The main non-priority debts that can be included in a DMP are: 

  • Credit Cards
  • Payday Loans
  • Store Cards
  • Overdrafts
  • Personal Loans

For your creditors to agree to a debt management plan, you: 

  • will need to have enough money left after you’ve covered your essential living costs each month to be able to afford to pay something towards your debts 
  • must be in a position to make payments that are high enough to clear your debts in a reasonable amount of time 
  • must not have enough disposable income to be able to pay off your debts within six months 
Money Helper

If we are unable to help you with all of your debts, or for further information and support to help you with your money troubles, please visit MoneyHelper.

Is a DMP right for me?

A debt management plan might be right for you if you’re struggling to keep up with your non-priority debt payments (credits cards, loans, store cards, buy now pay later etc.)

If you can’t afford the amount you originally agreed to but you can pay something each month, a DMP could be the answer. A debt management plan can help with temporary and long-term payment problems

DMP benefits & things to consider

There’s a lot to think about when you’re considering a DMP. To help you decide if a DMP is right for you, we’ve outlined the main benefits and things to bear in mind:

Get more time to repay your unsecured debts – credit cards, loans, overdrafts etc.

Make one affordable monthly payment towards all of your unsecured debt.

You’ll be left with enough money to cover all your essential living costs.

We’ll ask your lenders to freeze interest and charges.

It’ll take you longer to repay your debt.

We’ll need to check a DMP is suitable. If not, we’ll suggest other ways to deal with your debt.

We can’t guarantee your lenders will accept lower payments or freeze interest and charges but they normally do.

Your credit rating may be affected.

Advisor Image

Expert verdict: DMPs can provide a great sense of relief 

Customers are so grateful when we combine different debts into one affordable payment. It’s such a relief for them to let us deal with everything. 

Katrina – Debt advice specialist 
Money Wellness

Steps towards a DMP

How it helps: A typical example

“The people on the phone were so friendly, there was no judgement. It was just 'let's help you'. The process was just so easy, I knew that I had an end in sight.”
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Here is how we could help

  • Unsecured debt
  • Number of lenders
  • Previous monthly repayments

reduce to

  • New single monthly repayment


Your debt management plan will end when:  

  • you’ve paid off your debts in full; or  
  • you’re able to go back to making full payments again  

You’ll probably find that a DMP affects your credit rating. This is usually the case when you miss payments or pay less than the agreed minimum amount.   

On the plus side, making payments through a DMP – even though they were less than originally agreed - shows potential creditors you took steps to repay your debts in full. This will look better than simply missing payments. Once your DMP ends, you’ll be able to start improving your credit score.

There’s no minimum or maximum debt level needed for a debt management plan but there are certain things creditors will check before agreeing to one. Creditors are most likely to agree to a DMP if:  

  • you’re struggling to make your agreed repayments after paying your essential living costs  
  • you can afford to pay something towards your debts each month  
  • the amount you can afford to pay each month will allow you to pay off your debts in a reasonable period of time  
  • you don’t have enough disposable income to pay off your debts in full within six months

There’s no rule against going on holiday during a debt management plan. You can spend your money as you see fit, as long as your living costs and DMP payments are covered first.    

You’re unlikely to be able to afford anything too extravagant as you’ll be living on a strict budget. But an inexpensive break is not beyond the realms of possibility.  

A debt management plan doesn’t get listed separately on your credit file. Instead, each debt included in your DMP will be marked as either ‘AP’ (arrangement to pay) or ‘defaulted’. A debt with an AP marker will stay on your credit file for six years from the date it was settled. A defaulted debt will stay on your credit report for six years from the first recorded default. This means some, or all, of the debts marked as defaulted may already have disappeared by the time your DMP ends.  

For the debts that are still on your credit file when you complete your DMP:  

  • all of them should have a balance of zero (meaning you don’t owe anything)  
  • they’ll be marked as settled (if they haven’t defaulted) or satisfied (if they have defaulted)  

Even while these debts remain on your credit report, as time passes, it will be possible to improve your credit score if you stay on top of your money. Zero balances and settled debts also help when it comes to getting new credit at lower interest rates

Creditors are likely to agree to a debt management plan if they think it’s their best bet for getting their money back. We’ll let them know how much you can afford to pay each month, along with details of the money you have coming in and all of your essential costs.   

This will show them that you don’t have any leftover income to pay them more than is being offered. Each creditor will decide separately whether to accept the reduced monthly payment. Most of them do.  

If you’re struggling to make your debt management plan payments, contact us as soon as possible. It’s important that you don’t just stop making payments. This would mean your creditors don’t get the money they’re expecting, and they may decide the DMP isn’t working for them. They may then start asking for full payments again.  

We understand that people’s circumstances change. You may find you don’t have as much spare cash at the end of the month to put towards your debts. This may be the result of losing your job or the rising cost of living. Whatever the reason, we can look at negotiating with your creditors to reduce your DMP payments. 

You’ll need to provide information about your financial situation to help us set up your debt management plan. To begin with, we’ll ask you about the money you have coming in, your essential costs and your debts. You’ll need proof of these amounts, so it’s helpful to collect as many documents as you can in advance. The documents you might need include:  

  • wage slips  
  • benefit award letters  
  • utility bills 
  • council tax letter 
  • bank statements 
  • recent statements from your creditors  

Once we have all the information we need, it usually takes a few weeks to set up a DMP.

If you’re currently renting a property, a DMP won’t be a problem, providing you pay your rent and any rent arrears as agreed with your landlord.  

If you have a debt management plan and you’re looking to rent a new property, landlords and letting agents usually check financial information that is publicly available e.g. bankruptcy details or court judgments.  

Details of DMPs aren’t publicly available. Landlords and letting agents can’t access your credit report, which shows more detailed information on your debts, without your permission.  

Why choose us?

Our expert debt advisors have helped thousands of people in a similar situation to you. We'll listen and do not judge.

But don’t take our word for it...

Learn more about DMPs

There’s a lot to think about when you’re considering a debt management plan and you’ll probably have a lot of questions. We’ve put together some guides that we hope will answer those questions. If you can’t find the information you’re looking for, get in touch and we’ll be happy to help.

Debt management plans (DMP) and mortgages

How long does a debt management plan (DMP) stay on your credit file?

Taking out a loan during a debt management plan (DMP)

A wide range of debt solutions and services

It may be that a DMP isn’t quite right for you and another debt solution is more suitable. We’ll make sure we recommend the one that’s best for your individual circumstances and your long-term financial wellbeing.

Find more information on alternatives to a DMP.

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