Debt Management Frequently Asked Questions

Q

What will you charge?

A

Monthly Management Fee

We charge a monthly management fee of £35. There are no hidden costs for reviewing your circumstances or adding extra debts onto your plan. Because we offer the same level of service to for all of our Customers we do not believe that it is right to charge more to some Customers just because they have more available income. We feel that it is in your best interests to clear your debts as quickly as possible so we want to send as much to your creditors as you can afford.

Below is an illustration of the cost of a typical plan:

Non-priority debt: £9000
Number of creditors: 6
Monthly payment: £185
Set up fee: £0.00
Monthly management fee: £35.00
Plan length: 60 months
Total amount payable: £11100
Total fees payable over the period: £2100
In this example, all interest and charges have been frozen.
Set Up Fee

Angel Advance will not charge you a fee to set up your plan. We believe that it is important for both you and your creditors that you start clearing your debts from day one, rather than charging you a fee and reducing the amount that your creditors receive.

What do we do for our fee?
  • We complete an initial review of your circumstances and budget assessment
  • We calculate suitable repayment offers to your creditors
  • We contact your creditors to try and negotiate for interest and charges to be reduced/frozen
  • We make regular payments to your lenders
  • We complete a periodic review of your circumstances and financial statement
  • We complete a monthly/quarterly courtesy call with you
  • We send you a monthly statement to show what has been paid towards your debts
  • We will make changes to your plan as often as you need to accommodate changes to your circumstances
  • We will also continue to contact your creditors on your behalf during any short periods where you are unable to make any payments

Q

Can I get Free Debt Advice?

A

Yes – there are several sources of free debt advice available to all consumers. For further information please visit www.moneyadviceservice.org.uk. The Money Advice Service is a free and impartial service set up by the government to help people to manage their money.

Q

Can you deal with all of my debts?

A

We can include debts such as bank account overdrafts, credit cards, catalogues, store cards, unsecured loans and payday loans.

It is essential that you continue to make payments on secured debts such as mortgages and car hire purchase agreements because if you fail to keep up repayments to these debts, the lender may consider legal action or repossession. You must also maintain payments for priority debts including rent, council tax, gas and electricity as failure to maintain these repayments could lead to (in the case of rent) eviction, or the loss of essential goods or services. For more information, please see our different types of debt page.

You will also still be responsible for paying student loan repayments and payments required by the Child Support Agency.

We account for the need to maintain these payments when we calculate your single, lower, monthly payment.

Q

Will my creditors accept a reduced payment amount through a Debt Management Plan?

A

Our Creditor Liaison Team will negotiate with your creditors and request that interest and charges on each debt are frozen. This means that the money we send them will reduce the balance at a quicker rate. Please note that your creditors do not have to agree to the reduced offer and in some cases, interest and charges may still be added.

They may also decline to accept your offer if they believe that you are able to pay more than you are suggesting or you do not maintain regular payments.

Q

Will I be contacted by my creditors?

A

We aim to contact your creditors as soon as we get your signed Authority to Act, to notify them that we are working on your behalf. This should contribute towards reducing creditor contact, however, you may still receive some contact in the early stages of your plan.

Do not ignore the calls; please notify them that you have now appointed Angel Advance to act on your behalf. Remember, it is our job to deal with your creditors going forward, therefore we ask that you forward any letters or statements that you receive to us using the pre-paid envelopes that we provide.

Q

How are my payments distributed?

A

Your payments to each creditor will be calculated on a pro-rata basis. This means that whatever money is left over from your essential expenses will be split between your creditors on a percentage basis according to the total amount that you owe to them. Payments will be sent to your creditors within 5 working days of the cleared funds being received by us.

Q

Are you offering me a loan?

A

No, your debt management plan is a flexible solution designed to re-pay your unsecured debts at an amount that is affordable for you; Angel Advance is not lending you any additional funds.

Q

Will this impact my credit rating?

A

If you have experienced financial difficulties your credit rating may have already been impaired. Making reduced payments to your creditors may mean that your credit rating is affected in the medium-to-long term. This may affect your ability to obtain further credit in the future and make it more difficult to open a bank account.

You may also receive notices of arrears or default from your creditors. Please note that lenders are obliged under the Consumer Credit Act 1974 to send this information directly to you.

Not getting the right specialist assistance with your debts could have an even bigger impact on your overall credit rating in the long-term.

Q

Can I borrow more money whilst I am on the plan?

A

We would strongly advise you against taking out any more credit whilst you are on a debt management plan. To do so would imply that you have money to spare – since lenders have to carry out an affordability assessment - and therefore it would be reasonable for creditors to refuse any reduced repayment offers, or cancel any reduced arrangements that are in place.

Your creditors could also start reapplying interest and charges and contacting you directly about repayment of your debt.

Q

Can I change my mind?

A

You can cancel your debt management plan at any time at no extra cost. Please contact us to discuss your situation. If you change your mind within the 14 day “cooling-off” period, you may be entitled to a refund of any fees that you have paid during this time. Please note you would not be entitled to a refund if you are outside of the 14 day “cooling-off” period.