Covid Payment Plan (CVPP)

We’ll contact the organisations you owe money to that you include on your plan and you’ll just make one single payment to us. We’ll then distribute that to manage your payments. It’s that simple and you don’t have to worry.

You just need to let us know your income and outgoings, so in return we can understand how much you can reasonably afford to repay on your plan. We’ll make sure that your budget supports you resuming payment of your mortgage or rent and any other priority arrears you may have.

If your income increases you have an option to increase your payments or settle in full and close your CVPP.

Whilst you’re on a CVPP, we’ll work with creditors to reduce or stop your interest and charges. Where this is possible, it will mean your payments will go towards reducing the money you owe. Most creditors will agree to work with us on this, but they don’t have to.

You can be confident that the support you’re receiving is from an organisation who truly understand your situation and have decades of experience in supporting people to become debt-free.

We’re a charity too, so we’re interested in supporting you, not in making a profit from your situation. We’re also committed to delivering excellent service, having been awarded the Feefo ‘Platinum trusted service’ award in 2020.

Click here for a full list of debts that can be included in a CVPP.

It’s important that you continue to maintain all payments to any:

- Commitments you’ve not told us about

- Essential household bills, such as your mortgage or rent and utility bills

- Child support you pay

- Court fines you have outstanding

- Taxes you must pay

Not maintaining these payments could result in action against you.

Your creditors could try to recover the debt, you may lose access to essential goods or services or the goods could be repossessed.

You may be evicted if you don’t keep up to date with your mortgage, secured loan or rent payments.

If you have an overdraft on your existing bank account, you should aim to reduce the balance on this during the course of your CVPP. While there’s no ability to add an overdraft to a CVPP, reducing an overdraft reduces any interest and charges you have to pay for it, to positively help your financial situation.

To help you get back on track sooner, it’s important that you don’t increase your borrowing while you’re on the plan, by taking out new credit products or spending more on your current credit commitments.

If your income shows a lasting improvement during the term of a CVPP, you can increase the amount you pay, which will help you to return to making your normal monthly payments sooner. Contact us to arrange this when your financial situation improves.

You should end your plan sooner if you’re able to make your normal monthly payments to your creditors, or when you decide you no longer need it. This may help reduce the impact on your credit file.

You won’t be able to make additional, one-off payments to the plan.

If your financial situation gets more difficult and you find you’re struggling to make your monthly payment, get free debt advice as soon as possible. We’ll work with you to find your best long-term solution.

It isn’t permitted to miss or reduce your monthly payment to the plan. If you’re unable to make a payment towards your plan you must get in touch with us, as your plan will close. We’ll review your situation with you, find a solution you can afford, and cancel the plan.

The amount you owe your creditors at the end of the plan may have increased from what you owe them now.

Your creditors will expect you to repay any outstanding arrears on the money you owe after the end of your plan. You’ll need to talk with your creditors towards the end of your plan to arrange how you’ll repay the arrears. This may be done by increasing your monthly payment to them, or increasing the term of your arrangement.

Your creditors may continue to charge interest on the money you owe while the plan is in place. To reduce the amount of interest you may have to pay, we recommend you pay as much as you can afford through your plan.

If any of your creditors don’t freeze interest or charges on your account while you’re on a CVPP, your payments may only cover some or all of the interest, rather than reducing the amount you borrowed. That will mean your debt may be increasing. If this happens on any of the accounts listed in your CVPP, you should contact your creditor to understand how the payments you’re making to us are affecting your account with them. When you have this information, you may need to consider whether a CVPP is still the right option for you.

Credit providers have different approaches to how and when they issue default notices and how they’ll view the impact of this on your credit score. This means that depending upon the contributions you make to your creditors, they may still choose to record this as a default and could take further action. This may include legal action, selling the debt and/ or stopping further credit from that source. It may also impact your ability to obtain credit elsewhere. To understand what your creditors may or may not do you should contact them directly.

You should not ignore communications from your creditors during the length of your plan.

While you’re on a CVPP your credit file will reflect this and show that you’re making reduced payments by adding a notification on your file.

Creditors may add the under arrangement ‘flag’ to their account entries. This reassures anyone looking at your report that you’re making reduced payments as part of a plan.

It does mean that your credit rating will deteriorate during the time you’re on a CVPP. As you’re making reduced payments, your score will not deteriorate as quickly as it would have if you had failed to make these payments.

Of course, because the credit rating will be affected, the more you pay now and the sooner you can return to making your full contractual payments, the lesser the impact will be.

Credit providers have an individual approach to their default policies and how they’ll view the impact of this on your credit score. This means that your ability to take out new credit may be affected.

At the end of your CVPP, you may wish to take steps to improve your credit rating. We’ll provide you with helpful tips on to do this towards the end of your plan.

If you complete the plan successfully, you’ll return to making normal monthly payments to all your credit commitments, and pay your creditors directly.

You’ll find that some of your payments may have risen because of interest, charges and arrears that may have been added to your account, as you'll still have debts remaining at the end of the plan.

You’ll need to contact your creditors towards the end of your plan to come to an arrangement to repay any interest, charges and arrears. Your lenders will discuss this with you and may include increasing your monthly payment or increasing the term of your arrangement.