Debt management companies

You can use a debt management company (DMC) to help you deal with your debts, although they charge a fee and normally only deal with your non-priority debts.

The debt management company (DMC) consolidates your debts, so you just pay them and they distribute the money amongst your creditors. They draft letters and negotiate with creditors.

But using a DMC does not guarantee you a favourable outcome or prevent creditors taking action against you.

People who want a third party to deal with their debts.

• You don’t have to do any work in dealing with your debts
• You only have to make one payment – to the debt management company (DMC)
• You will be able to see someone immediately

• Many debt management companies (DMCs) only deal with non-priority debts
• You will be charged a fee of about £200 and possibly a monthly fee too of up to £30
• DMCs usually only deal with customers who have some income and their own home
• Using a DMC does not ensure that action won’t be taken against you by your creditors

Find out more about debt management companies (DMCs) on the Citizens Advice Bureau website.