Debt management plans and mortgages & tenancies

It won’t be impossible to get a mortgage during your DMP, but it’ll be harder, and you may not get the best deal. Once your DMP is finished and your debts paid off, your credit file will steadily improve and you should find it easier to get a mortgage.

Nevertheless, you may still want to try getting a mortgage during your DMP, especially if you’re living in a private rented property, where rents can often be higher than the equivalent mortgage payments.

Can I remortgage on a DMP?

Remortgaging is when you replace your current mortgage with a new one. You may want to do this during your DMP to reduce your monthly mortgage payments or release an amount of money.

Just like getting a new mortgage, it’s likely to be harder to remortgage during your DMP and you may have a limited range of options and no access to the best interest rates.

While it’s not guaranteed you’ll pass a credit check while you’re on a DMP, very few of our clients have problems getting car insurance. However, you may be charged a higher rate of interest because of your credit history, so your monthly payments could be higher.

Mobile phone contracts - If you’re on a DMP it’s a good idea to keep your mobile phone costs as low as possible. New mobile phone contracts will usually involve a credit check, and there’s a chance you’ll be rejected if you’re applying for a contract that includes an expensive phone and high monthly cost. If you’re looking at cheaper handsets with lower costs you may have a better chance of being approved.

Will a DMP affect my home if I rent it?

A DMP won’t affect your current tenancy as long as you keep your rent payments up to date, and you pay off any rent arrears at an amount your landlord agrees.

If you have rent arrears, these are a priority payment. If you’ve told us about them, we’ll have included a payment towards the arrears in your DMP budget.

If payments to the arrears have been agreed with your landlord, or were set by a court, as long as you keep paying them during your DMP, no further action will be taken. 

If you have an emergency, for example a drop in your income one month, and you can’t afford to cover your rent and your DMP payment, let us know as soon as possible. Your rent and rent arrears should always be paid first, before your DMP repayments.

Can I rent a new home on a DMP?

When checking your credit history, private landlords and letting agents generally rely on public information such as details of bankruptcy or court judgments. Your DMP can’t prevent your creditors applying for a CCJ or decree, so it’s possible this may have happened before or during your DMP, and this could make it more difficult to get a new private tenancy.

Landlords can’t see detailed information about your credit debts, default notices and other information held on your file with credit reference agencies. They can only access this if you give them permission.

Even if a landlord is unwilling to accept you for a tenancy because of information they find about your debts, you may be able to persuade them by offering a higher deposit, supplying additional references, or a guarantor.

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