The traditional Debt Management Plan (DMP) or Debt Management Programme has almost always been a function that has limited additional benefits to the consumer except for the standard benefits. These include a single consolidated monthly payment, reductions or elimination of interest and the reduction of elimination of creditor or collection pressure during repayment.

Myvesta UK has just released a vastly improved approach to making DMPs a very good consumer solution for short-term intervention with creditors and collection agencies.

The newly added features of the Myvesta UK One-Pay DMP now include a free legal assistance scheme for DMP and Myvesta Individual Voluntary Arrangement (IVA) clients and a free benefits entitlement check to uncover government welfare benefits that clients may be eligible for but currently not receiving.

The legal assistance protection scheme is unique in that it provides the following benefits.

  1. Legal Assistance in the formation and promotion of an approved IVA by an Insolvency Practitioner that your Creditors have rejected while working with Myvesta UK;
  2. Legal Assistance where your Creditors unfairly harass and/or chase you for the debts under a DMP prepared by Myvesta UK;
  3. Legal Assistance to pursue your Complaint to the Financial Ombudsman in respect of a rejection of your IVA proposal arranged via Myvesta UK;
  4. Legal Assistance in the formation and promoting of an approved/prepared DMP by Myvesta that your Creditors have rejected;
  5. Legal Assistance to pursue your Complaint to the Financial Ombudsman where your Creditors unfairly harass and/or chase you for the debts under an approved DMP approved/prepared by Myvesta.

More and more consumers are receiving unfair or unreasonable treatment from creditors in the attempt to repay their debts. Ironically these actions are pushing more people needlessly and recklessly towards bankruptcy.

Bankruptcy in the UK remains a legal and viable solution for problem debt and while it is true that many people should consider bankruptcy as the best financial solution to eliminating problem debt, many avoid bankruptcy for personal reasons.

We certainly cannot blame or chastise people who want to honour their debts and repay what they can reasonably afford to repay. In fact we should give consumers that are willing to make the sacrifices necessary to repay problem debts some recognition of their efforts through special terms or benefits of making the effort.

Currently a DMP offers consumers less safety today than it once did. Since a DMP is a non-binding debt repayment proposal, creditors have the right and ability to alter the terms or reductions originally offered. In the United States, CCCS which lead the debt management field before being exported to the UK has found that creditors are now buying and selling portfolios of debts that include those customers that are in a Debt Management Plan. New owners of this bad debt purchased can and do change the interest rates since the DMP plan is not binding on the creditor.

Debt management plans could be a more effective solution if regulation in the UK existed to make pro-rata DMPs, essentially equitable disbursement and binding Debt Management Plan, behave more like an IVA, where remaining debt is forgiven, written off or charged off after no more than five years of repayment. As it stands now, debtors making self-administered £1 per month payments or DMP payments that are not sufficient to repay the original debt in full within 20, 30, 40 years or more, this approach is not realistic.

The new Myvesta UK DMP benefits are designed to provide a superior level of consumer protection while the benefits entitlement check provides an extra level of consumer care by checking to see if additional benefits are available that can greatly reduce or eliminate the problem debt.

Note: In the past Myvesta UK referred DMP clients to both Payplan and Consumer Credit Counselling Service (CCCS) in the UK but now handles all DMP clients in-house using the latest DMP software that provides clients with 24/7 access via the web to review and check their accounts.