If you've got a debt management plan (DMP), you might find your creditors are still contacting you or asking for payment, even though you're making payments they've agreed to.
This page explains why creditors might still contact you and what you can do about it.
There are a number of reasons why creditors might still contact you if you're in a DMP:
To send you regular account statements
Under the rules in the Consumer Credit Act 1974, your creditors will normally have to keep sending you annual statements as well as arrears and default notices in a set format. This happens even when you're in a DMP. Don't worry, as it doesn't mean there is a problem with your DMP. However, if you receive other letters demanding payment or threatening court action, you'll need to contact your DMP provider for advice.
You haven't had your DMP for very long
Some creditors might chase you for payment if you haven't yet made many payments on your DMP. You should tell your creditors that you're paying into the DMP that they've agreed to and ask if they'll stop sending you reminders.
They're chasing you for debts not in your DMP
Remember that a DMP won't pay off all your debts. Your priority debts, such as mortgage arrears or court fines, can't go into a DMP. You need to make arrangements to pay these debts first and still need to deal with these creditors yourself.
The creditor has refused to deal with the DMP provider
Sometimes a creditor will refuse to deal with a DMP provider. This could be because the creditor doesn't want to accept the reduced payments or sometimes it could be because they've objected to you using a fee-charging provider, which would mean there's less money to pay the debts you have with them. If the creditor doesn't want to deal with the DMP provider, they can still take action to recover the money you owe, which might include taking you to court.
If this applies to you, ask the creditor why they're not willing to co-operate with the DMP. You can try to negotiate with them yourself to see if they'll change their minds. However, they're not legally obliged to do so, so you might need to keep dealing with this creditor separately.
The creditor has made a mistake
The creditor might simply have made a mistake or not fully updated their records. If you think this is the case, ask the creditor why they're still contacting you, remind them that they've agreed to the DMP and ask them to update their records.
The creditor is doing something they're not allowed to do
A creditor is still allowed to contact you while you're in a DMP, but they shouldn't do any of the following:
making demands for payment in a way that is deliberately meant to alarm, distress or humiliate you, your family or your household, such as turning up on your doorstep threatening to take goods if you don't pay
contacting you too often or late at night
contacting you through Facebook, Twitter or other social networking sites
pressuring you to sell property or take out more credit to pay your debt
using more than one debt collection company at the same time or not telling you when your debt has been passed to another company
producing any document which looks like it's official when it isn't, or making false claims that a document is official when it isn't
pressuring you to pay in full orto pay more money than you agreed in your DMP
making threatening gestures or statements
threatening you with court action
If you think the creditor shouldn't be contacting you
While there are many valid reasons for a creditor to contact you while you're in a DMP, if they've agreed to the DMP they should accept the fact that you're making payments through it and keep contact to a minimum.
If the creditor is contacting you more than they should, you should tellyour DMP provider. They might be able to negotiate with the creditor to stop contacting you.
If they're unable to do this, you can complain to the creditor yourself. Explain that you're in a DMP and ask them to stop contacting you. If this doesn't work you can complain to the Financial Ombudsman Service.
Next steps
Find out what to do if you're being taken to court for debt.
FAQs
While there are many valid reasons for a creditor to contact you while you're in a DMP, if they've agreed to the DMP they should accept the fact that you're making payments through it and keep contact to a minimum. If the creditor is contacting you more than they should, you should tell your DMP provider.
Do creditors have to accept debt management plans? ›
When your debt management plan is being set up, your creditors will sometimes agree to freeze any interest charges. However, they don't have to agree to this and they don't have to agree to your plan at all. If they don't, they can also continue to contact you, ask for payment or even take you to court.
What happens if a creditor refuses a DMP? ›
If a creditor rejects my DMP, does that mean it is failing? The people you owe will usually take what you can afford to pay them through a DMP. But they may not accept it if they don't think it works in the long term. Get in touch with your DMP provider if the people you owe refuse your payment.
How do I stop a debt collector from contacting me? ›
How do I stop a debt collector from contacting me? Mail a letter to the collection company and ask it to stop contacting you. Keep a copy for yourself. Consider sending the letter by certified mail and paying for a “return receipt.”
Can I ask a debt collector to stop contacting me? ›
You have the right to tell a debt collector to stop contacting you. If you ask a debt collector to stop all contact – regardless of the communications channel – the collector must stop. Keep in mind, though, that you could still owe the debt.
Are creditors likely to accept a DMP? ›
Sometimes a creditor will refuse to deal with a DMP provider. This could be because the creditor doesn't want to accept the reduced payments or sometimes it could be because they've objected to you using a fee-charging provider, which would mean there's less money to pay the debts you have with them.
Can you get out of a debt management plan? ›
A DMP isn't a legally binding agreement. This means that you can cancel it if you want to. There are a number of reasons why you might want to cancel, including: you're not happy paying a fee each month which means there's less money left to pay your creditors.
What happens if I can't pay my debt management plan? ›
Missing a payment will mean your creditors don't get the monthly payment they're expecting, which may mean they decide to stop co-operating with your DMP. Don't bury your head in the sand, as this will only make the problem worse. Talking to your provider quickly is the only way to get the problem sorted out.
Do creditors freeze interest on a DMP? ›
your creditors won't necessarily freeze the interest and charges on your debts, so the amount you owe might go down by less than you think. your DMP provider might charge you a fee, although there are several free providers you can use so there's no need to pay if you don't want to.
What happens if a debt collector never contacts you? ›
The FDCPA prohibits debt collectors from making false statements about the character, amount, or legal status of your debt. What if the debt collector never sent me written notice of the debt? You can still assert your dispute and verification rights. The 30 day time limit will not apply.
Debt collectors cannot harass or abuse you. They cannot swear, threaten to illegally harm you or your property, threaten you with illegal actions, or falsely threaten you with actions they do not intend to take. They also cannot make repeated calls over a short period to annoy or harass you.
What is the 11 word phrase to stop debt collectors? ›
If you are struggling with debt and debt collectors, Farmer & Morris Law, PLLC can help. As soon as you use the 11-word phrase “please cease and desist all calls and contact with me immediately” to stop the harassment, call us for a free consultation about what you can do to resolve your debt problems for good.
Can I verbally tell a debt collector to stop calling? ›
Regardless of how they're contacting you, you have the right to tell a debt collector to stop. This request must be made to the debt collector in writing. The CFPB offers sample letters for asking a debt collector to stop contacting you.
Can a creditor refuse a payment plan? ›
Your creditor can refuse your repayment offer and ask the court to make a decision on your case. This doesn't usually involve a court hearing. This might mean you're asked to pay more than you can afford.
Do credit card companies accept DMP? ›
If your DMP encompasses any of your credit card accounts, they will typically be closed. This closure is often a condition set by creditors in exchange for reducing your interest rate.
Will debt collectors accept payment plans? ›
If you can't pay a large lump sum, you can ask the collection agency to create a payment plan you can afford. You'll need to negotiate how many payments will be required before the debt is settled.
Do creditors have to work with debt settlement companies? ›
There's no guarantee of success: Debt settlement doesn't always work. Not all creditors work with debt settlement companies, and even if they do, they may not accept the settlement offer. Depending on how long settlement takes, the fees and interest that accrue in the meantime may wipe out any potential savings.
