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Will a debt management plan stop creditor action?

A debt management plan (DMP) doesn’t stop your creditors taking further action to get you to repay your debt, for example adding further interest and charges or getting a CCJ. However while further action is possible, it’s not always likely to happen.

Here are some of the actions your creditors could take while you’re on a DMP:

  • Creditors reject your DMP offer
  • Creditors still contact you
  • Interest and charges added to debts
  • Credit file affected by DMP
  • Creditor applies for a CCJ

On this page we’ll talk more about these actions. If you’re worried about something your creditor says or does you can always get in touch with us for advice.

My creditor won’t accept my DMP payments

DMP payments are usually less than the amount you originally agreed to repay to your creditor, and sometimes a creditor will contact you to say they don’t accept the offer.

This just means they’re not willing to agree to the payment amount as a long-term solution to your debt. In most cases, if a creditor says they’re not accepting your DMP offer, this will mean they’ll pass the debt to a collection agency.

Don’t stop paying a debt just because the creditor says they don’t agree with the offer. The creditor should still accept the money sent through your DMP, and if they don’t you should let us know.

The payments you make to your DMP are based on what you can realistically afford. Even if a creditor doesn’t accept the amount you offer, don’t feel pressured into offering them a higher payment which you can’t afford.

Will creditors contact me during a DMP?

Creditors can continue to call or write to you during your DMP, but in practice you can expect contact from them to reduce if you stick to the payments you’ve agreed. 

Contact from creditors is more likely:

  • In the early stages of your DMP
  • If you miss any payments during your DMP
  • At points when creditors want to check if anything has changed, typically every six or twelve months.

Creditors have to send you some letters by law, and these will continue if you’re on a DMP. Examples include annual statements for some types of debt or default notices. 

If a creditor is still contacting you a lot, or pressuring you to increase your payments or pay them extra outside the plan, let us know.

Interest and charges on a debt management plan

At the start of your plan, we’ll always ask your creditors to stop or reduce any further interest and charges.

Industry guidance to lenders says they should always ‘consider’ stopping or reducing interest for people who are in financial difficulties and trying to sort them out. But they are not legally obliged to stop interest, and a DMP can’t force creditors to do this,

However, in practice most will agree to stop or reduce interest and charges. Some will do this as soon as they know about the DMP, while others may wait a bit longer. It’s rare for creditors to continue charging interest in the long term during a DMP.

Debts are often passed on to debt collection companies while you’re on a DMP interest and charges will normally be stopped if this happens.

Will a DMP affect my credit file?

A DMP will impact your credit file because you’re paying less to your debts than the amount stated in the agreements you signed with your lenders. This means arrears are building up each month, and this will be recorded in the payment history shown in your credit report.

Creditors may also add a marker to your credit file showing that your payments are being made through a DMP.

It’s also likely that at least some of your accounts will default while you’re on a DMP, and this will be recorded on your credit file too.

Can you get a County Court judgment (CCJ) on a DMP?

 A DMP isn’t based on Government legislation, so unlike solutions such as an individual voluntary arrangement (IVA) or bankruptcy, a DMP doesn’t protect you from legal action by your creditors. However, while it’s possible you could get a CCJ during your DMP it is rare if you stick to the payments you’ve agreed. In the vast majority of cases your creditors won’t take this type of action.

When you start a DMP we’ll send your creditors details of your income, household spending and debts. This shows them that the amount you’re paying is the most you can realistically afford, and that your payments are being shared out fairly amongst your creditors.

A court would use similar information to decide how much you should pay to a CCJ, so creditors know that court action isn’t guaranteed to get them a higher payment than they’re already getting from your DMP.

However, it’s still possible that a creditor could apply for a CCJ during your DMP. For example, they may do this because they want to apply for a charging order, to secure the debt against your property, or because the CCJ gives them an extra guarantee that you’ll stick to the agreed payments.

If you receive a CCJ claim form while you’re on a DMP, it’s important to let us know straight away so we can help you fill in the forms correctly. Then when you get a judgment letter back from the court, contact us again. We’ll update your plan to take in account the new CCJ payments, and if the payments have been set at a higher amount than you can afford, we can help you to ask for these to be changed.

If you have a CCJ added to a debt during your DMP, it’ll need to be treated as a priority debt because the consequences of missing payments to it become much more serious. This means that if you ever miss a monthly DMP payment, you’ll still need to make sure your CCJ is paid.


Manage your DMP online. Update creditor details or complete your annual review at a time and place to suit you, day or night.


Helping you become debt free...

“I wish to thank your staff for all the great help they gave me when I was in so much debt.
They were a pillar of support to me.” (Leslie, Essex)

Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.

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