Do you qualify for bankruptcy? Find out with our free, simple test

Start my free debt test

The Bankruptcy Service - Debt Management Plans (DMP)

The solution that will be advised will depend on your situation, so please feel free to learn more about one alternative, Debt Management Plans, and take our quick debt test to receive help.

A debt management plan is a more informal debt restructuring solution for unsecured debt. It could be the best option for you if you have debts above £1,500 and owe money to more than one creditor.

What’s more, you can have an expert handle all your negotiations with creditors, reduce monthly repayments and restructure debts so you have to make a single monthly payment, though you must be in a position to afford at least £100 payments each month. The single payment would then be distributed accordingly amongst your creditors.

The option of managing debt without bankruptcy could involve reaching an agreement with creditors to adjust payment terms by lengthening the repayment period compared to the original agreement. This could be done directly by yourself with the creditors in question, but using the advice of experts can be beneficial and take much of the stress out of the process. At the Bankruptcy Service we are here to help any people looking to enter into a debt management plan.

This is an option that may suit those who have had a temporary drop in income.

Debt management plan (DMP) advantages

  • A DMP is far more informal an arrangement than other options such as an IVA or bankruptcy.
  • Monthly repayments may well be reduced.
  • Creditors may well freeze interest payments as part of the plan.
  • As the plan involves reaching agreements with creditors, the result may be a suspension of certain actions pending against you, such as county court judgments (CCJs).

Debt management plan disadvantages

  • The informal nature of the plan can also act as a disadvantage. The lack of rigidity means that creditors can change their mind.
  • This option can still have a negative effect on your credit rating.
  • Whilst a reduced monthly payment is appealing, in the long-term the debtor may actually end up paying more, and over a longer period of time. This is not a quick-fix and the individual may remain in debt for a long time, and longer than if they used other options available to them.
  • Debts will still attract interest, which may rise as part of the agreement.
Free debt counselling and advice is also available from the Money Advice Service available at: doesn't charge a fee for its bankruptcy service, but receives remuneration from the partners that we work with in order to keep operating. Those partners must charge a fee to the customer to likewise cover operational costs, and this amount will vary depending on the solution offered, and the terms of the parner. For details of these terms, please refer to the website of the organisation dealing with your bankruptcy. Upon application with, we will forward your information on to one of our specialist debt partners. You will then be contacted, and you will be able to explain your case, and expert advice will be offered in order to ascertain the most appropriate debt solution.