How do Debt Management Companies work?
Debt management companies can speak to your bank, debt collectors or other creditors on your behalf to discuss your situation and negotiate a more favourable deal. This may involve lowering your monthly repayments or interest rate, waiving fees and charges, or other debt relief strategies to help you get back on your feet.
What type of debts are covered with our Debt management Plans?
Debt Management Plans cover most unsecured debts. These are debts that are not tied to an underlying asset, such as a house or car. The most common types of unsecured debt in Australia are personal-loans and credit card debt. Students loans are not covered.
What do I need to do?
If you believe a Debt Fix Debt Management Plan may be an option you wish to explore, you’ll need to provide us with information about your debts and your financial circumstances so we can give you a free debt management options analysis.
We will need to know:
- The total amount of debt you owe and who you owe money to
- Your monthly income and expenses
- The cause of your financial difficulties
With this information, we'll work closely with you to calculate how much you can comfortably afford to pay each month within your budget. We’ll also discuss your financial goals and help you plan a debt free future.
What happens next?
We’ll draft your Debt Management Plan (based on your budget and circumstances) and contact your creditors on your behalf to explain your situation. Lenders in Australia are obligated to consider requests for debt relief when borrowers are experiencing financial hardship or difficulty. While relief is not always granted, there's a higher chance of success when the case is made by a skilled financial negotiator.
If your creditors agree to the reduced payment plan, we'll start drawing funds from your nominated account to transfer to your creditors. The funds you pay will be affordable as determined by your budget and will be forwarded to your creditors to settle the debts.
Your new agreed payment schedule will be on more affordable terms as arranged on your behalf by your Debt Fix Debt Management Specialist.
It's essential that you keep up with your repayments otherwise your creditors may elect to cancel the DMP. If you start to miss repayments, and your creditors cancel the plan, your situation will return to that place where you were before the DMP was set up, resulting in increased fees, penalties, financial stress and higher interest rates. In other words, if you default on the DMP, you financial stress will return. Debt Fix Debt Management Specialists are always on hand if you're worried about your plan or you need some assistance.