Debt problems

44smithy

If you have debt problems and you have you money managed by a debt management company do the credit cards companies etc have to reduce their interest rate????

cabbage

No, there's nothing in law that says they have to reduce or freeze the interest but most good companies would be able to get this done for you using their name and goodwill.

chattychappy

I believe the Lending Code says they are not supposed to raise the interest rate once you've got into trouble.

My connection is so slow at the moment I can't check this for sure.

Tixy

Hi

There is nothing to force a creditor to reduce or freeze interest. In a DMP usually most people find most of their creditors do eventually agree to freeze interest.

If you are considering a DMP then use one of the charities who won't charge you a fee. That way your creditors will know you are paying all your can (not wasting money in fees). If they think you are paying all you can afford then they are more likely to freeze interest.
IMPORTANT - Where to seek professional impartial advice about your debts.

Also if you have sought advice from some of the fee charging companies we have found not all are as upfront at they could be about explaining the effect the DMP will have on your credit file. Please make sure you fully understand what a DMP entails before you sign up to one.