What is debt management?

It may be possible to reduce your monthly payments by negotiating with creditors asking them to accept lower payments and where appropriate reduce or even waive interest and other charges. You can do this yourself or you could ask a debt management company to help.

Some debt management companies will provide advice and sample letters so youre better equipped to talk to your creditors. Others will negotiate on your behalf and handle everything from letters and phone calls to payments youll pay them and theyll distribute the money among your creditors.

However creditors are unlikely to agree and debt management companies are unlikely to be able to help you unless its clear that you are:

a. in genuine difficulty and unable to make the payments as originally agreed and

b. willing and able to pay your debts with regular - even if reduced - payments

Note that any debt management programme is an informal arrangement neither you nor your creditors are legally bound by any agreements you make. Individual Voluntary Arrangements IVAs and Bankruptcy on the other hand are legally binding formal arrangements.