Which one to use for a debt management plan – a Debt Charity, a Fee Charger or DebtWizard?

We highlight what we think are the pros and cons of each.

Debt charity

FOR - With the debt charity all of your monthly payment goes towards your creditors/lenders and in return they receive a commission or donation. Because you are actually paying that little bit more each month compared to a commercial fee charging firm you will reduce the time period of your repayment plan. For many consumers this works well.

AGAINST - Debt charities are being faced with a huge demand for their services and can take longer than a fee charging firm to even set up a telephone appointment to go through your finances. For those that are desperate for immediate help this can be a worry.

Take me to the debt charities and helpful organisations.

DebtWizard.com

FOR - With Debtwizard.com you will not be charged a fee for a debt management plan and like the Debt Charity, all of your payment goes to the creditor/lender, you pay off that little bit more each month, reducing the period of your repayment plan, compared to a commercial fee charging firm.

FOR - So, no fees and less time to repay, we match the debt charities  Plus, unlike a Debt Charity, we can deal with your enquiry straight away! Through our association with our 'trusted 3rd party', Payplan, we can handle the workload and usually go through your enquiry on the same day of contact or within a few days.

AGAINST - Nothing!

Take me to how to get Fee-free Debt Management Plans/IVAs and free debt advice

Fee charger

FOR - Fee charging firms will generally deal with your enquiry on the same day of contact or a within a few days.

AGAINST- Fee charging firms are commercial companies and they will charge you every time they distribute a payment to your creditors; this is usually around 15% to 18% of your monthly payment. So if you pay for example, £200 per month to the commercial debt management company, they will take, around, £35.00 for professional fees so your creditors will only receive only £165.00 instead of the £200.

AGAINST -There are some firms that will ask for the first three months payment from you in advance BEFORE they actually start work on your behalf. Stay away from these firms as there are others that will do the same job with just one month fee and will normally start work before you have actually paid anything.

Based upon previous positive experiences, Debtwizard.com will only recommend one commercial debt management firm and that is Bright Oak.