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Professional advice

Money Helper helps people manage their money. They do this directly through their own free and impartial advice service.
Also working in partnership with other organisations to help people make the most of their money.

Debt Management Disadvantages

  • Your creditors are not legally forced to freeze interest and charges on your accounts and even if they do it is usually only for a limited period of time. Creditors will require ongoing information and can change their minds about freezing interest. In some instances if creditors refuse to freeze the interest and charges accruing on your account it is possible that the size of your debt will continue to increase during the term of the programme so far from resolving your debt problems the debt will continue to increase.
  • You have no court protection from your creditors who can at any time break ranks and decide to issue court action or other legal process for the recovery of the debt. Creditors who are unhappy with what they are being paid on a financial management programme could also issue a bankruptcy petition against you at court.
  •  Not all of your creditors may agree to the programme. Those creditors are likely to continue in recovery proceedings against you escalating the size of the debt all the time. Some creditors may even try to get security for their debts over any assets you may own by use of the county court bailiffs (they will usually secure charges over personal items eg furniture or your car) or by way of charging order proceedings usually over your house. In both cases assets can be sold to repay debts.
  • Creditors would expect payment in full in respect of the outstanding debt. No part of the debt would be written off.
  • Some creditors have minimum repayment requirements for example if an individual creditor feels that what is being offered to them is low they may require individual increases. This again would make the programme unworkable.
  • A financial management programme would have an adverse effect on your credit rating as your creditors would log with the consumer credit reference agencies the offers of reduced payments under the financial management programme.

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