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Debt management FAQs

1. What is a Debt Management Plan?
2. Can I just do this myself?
3. Are all of my debts included?
4. How long does it last?
5. Who is eligible for debt management?
6. What happens when the Debt Management Plan finishes?
7. What happens if I miss a payment?
8. Can creditors still chase me or take me to court?
9. Why can't I just get a new loan?
10. Is debt management better than an IVA?

1. What is a Debt Management Plan?

A debt management plan is an agreement between you and ClearStart that allows us to negotiate with your creditors on your behalf. If we can successfully agree a way forward, you will make just one, lower payment to us each month. We pass 100% of this payment to your unsecured creditors. Exactly how much the monthly payment is depends on your circumstances and what your creditors will agree to.
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2. Can I just do this myself?

There is nothing to stop you from asking creditors if they will agree to lower repayments and If you have fewer than two creditors we recommend that you try and talk to them yourself first. The advantage of working with ClearStart is that we have the experience needed to know what your creditors will agree to and we offer valuable support when talking to them. A disadvantage of going it alone is that you may be building up problems in the future. ClearStart can advise you on whether or not a particular plan is a good idea in the long term.
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3. Are all of my debts included?

All unsecured and lower priority debts such as credit cards and overdrafts are included within a debt management plan. Payments such as rent and mortgage payments are not included, but we will ensure that payments for these items are prioritised before deciding how much you can afford to repay for unsecured debts such as credit cards and overdrafts. By doing this we can help you to remain in your home.
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4. How long does it last?

This depends on how much you owe, how much you can repay and what your creditors will agree to. There are no firm answers and things can change - ClearStart will work with you to try and ensure the best possible outcome. Simply complete our online application form and we will estimate how long all of our plans would take, and how much you would have to pay.
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5. Who is eligible for debt management?

Anyone is eligible, but there are circumstances in which creditors would not agree to what would be needed to ensure a successful plan. It is essential to get independent advice on this.
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6. What happens when the Debt Management Plan finishes?

It may be that you can repay enough over time to reach a final settlement with your creditors so that they are no longer pursuing you for any money. You need to be aware of the damage to your credit rating that many missed or partial payments will have caused, so you will find it harder to get credit in future.
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7. What happens if I miss a payment?

If you're likely to miss a payment it's important to let ClearStart know as soon as possible. It may be that we can get creditors to agree to a missed payment in some circumstances, although you will usually need to make up the payment later.
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8. Can creditors still chase me or take me to court?

Because debt management is not a legally binding agreement, creditors are free to continue chasing you for money although this is unlikely to happen once they have accepted the plan. They can also start or continue with legal actions if they decide that they want to do this, although ClearStart manages plans very carefully, which makes legal action less likely.
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9. Why can't I just get a new loan?

There is no one-size-fits-all answer to this question and ClearStart can help you assess your own circumstances. In fact, we will always show you all sensible options when we talk about your circumstances and a consolidation loan can sometimes be helpful as an alternative to debt management. Our online application form will help show you the alternatives.
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10. Is debt management better than an IVA?

The best debt solution is different for everyone. It all depends on how much you owe, how much you earn and how much you spend. ClearStart will always give you honest and independent advice on the solution that is likely to be best in your own circumstances.
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Further Reading:
Debt | Debt Advice | Debt Solutions | How Debt Management Plan Works | Debt Management FAQs | Compare Debt Solutions |

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