A Debt Management Plan is a private procedure. There is no public register so it is very unlikely anyone will find out unless you tell them.
Included in this article:
- Who is told you have started a DMP?
- Does your bank have to know?
- Will your employer find out
- Do you have to tell your landlord or mortgage company?
Want to start a DMP? Give us a call (0800 077 6180) or complete the form below to speak to one of our experts
Who will be told about my Debt Management Plan?
A Debt Management Plan is a discrete agreement with your creditors Who will be told? Is there a formal register? To find out more please visit: http://beatmydebt.com/debt-management-plan/find-out-if-debt-management-plan-is-right-for-you
Who is told that you have started a Debt Management Plan?
A Debt Management Plan (DMP) is an informal agreement with your creditors. You can set one up yourself or use a service provider to help you. Either way there is no record if you being formally insolvent.
There is no requirement to register the fact you have started a Plan. As a result your name does not appear on any list which could be looked up.
No-one is officially informed. People such as your friends and family, landlord, mortgage lender or employer are unlikely to find out unless you tell them.
The only way someone could find out that you have started a Debt Management Plan is to carry out a credit check against you. It will normally show up on your credit file.
Does your bank have to be know?
Whether your bank will find out about your Debt Management Plan depends on whether you owe them money. If not you can continue using your account as normal. They will not find out and you do not have to tell them.
However if you have an outstanding overdraft, loan or credit card you will normally need to include this debt in your plan. The bank will then find out and you will need to open a new account elsewhere.
Opening a new account with a different bank is necessary to protect you from the set off rule. If you try to keep your old account going the bank can take money out of it without your agreement to set off against the debt you owe them.
If your bank is not involved with your Debt Management Plan they will not find out and you can keep using the account.
Will your Employer Find Out you are in a Debt Management Plan?
Your employer will not be infomed that you have started a Debt Management Plan. They are very unlikely to find out about your financial situation unless you tell them yourself.
Normally you are under no obligation to tell your employer. Some employment contracts require you to inform them if you become insolvent. However because you are not formally insolvent if you are in a DMP even then you would not have to tell them.
The only time when your employer could find out about your situation is if they carry out a credit check against you. This would highlight that you are in a Plan and have financial difficulties.
If your employment contract requires you to maintain a clean credit record then you may not be able to start a DMP as it will make your credit rating poor.
Do you have to tell your Landlord or Mortgage Company?
You do not have to tell your Landlord or Mortgage Lender that you have started a Debt Management Plan. As long as you continue to pay your rent or mortgage on time they will not find out.
As a homeowner the only time you will ever have a problem is if you want get a new mortgage. Because your credit rating is poor it is unlikely you will be able to do this either with your current or an alternative lender.
You are also likely to face difficulties if you want to move to a different rented property during your Plan. Most letting agents will carry out a credit check against you which you will fail.
Moving to a different rented property during a Debt Management Plan may only possible if you can pay rent up front or someone is willing to act as a guarantor for you.
Arrange a call with a DMP Expert
Privacy Policy
Your information will be held in strictest confidence and used to contact you by our internal team only. We will never share your details with any third party without your permission.
My employer regularly conducts ‘financial probity’ checks against a consumer database to check for CCJs/Bankruptcy/Insolvency. Will a DMP be visible?
Hi Peter
This depends on whether your employer checks the IIR (Personal Insolvency Register) or does a credit check against you. They can check the IIR whenever they wish as this is a public record. However, if they do, you have nothing to worry about. A DMP is not a formal insolvency procedure and the fact you have one is not recorded on the IIR.
In terms of your credit file, most if not all the creditors will register defaults against you which will show up. In addition, some creditors do instruct the credit reference agencies to add the fact you are on a DMP to your file as well.
So you will only have an issue of your employer does a credit check against you. However, they would not be able to do that without your specific permission.