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Key Information

Here you will find key information about our debt services. Simply click a question to see the answer.

What does it cost?

The Initial Fee is £495 which covers the cost of setting up your Lifeplan. This includes undertaking the initial assessment of your financial position, carrying out a fact find of your income and expenditure, preparing your Statement of Affairs, contacting your creditors and providing them with a copy of your Statement of Affairs and Offers of Repayment.

Your initial payments are retained by us (over a period of no more than 4 months) in settlement of the Initial Fee. We will send token payments of a minimum of £5 to each of your creditors until the fee is paid. Your arrears position may worsen during this initial period, however your creditors will be made aware of the situation.

The Monthly Management Fee will be £30 (1-2 debts within the plan), £35 (3 debts) or £40 (4 or more debts).

The Monthly Management Fee is to cover the cost of administering payments to creditors, dealing with queries from them, reviewing your circumstances with you at least every 12 months and providing you with support during the life of the plan via our dedicated Personal Advisors.

What do I do if I keep getting letters and phone calls from my creditors?

To begin with you may still get letters and phone calls from your creditors. You must not ignore these. This happens because it takes a short time to negotiate with your creditors and they will continue with their standard collection activities until a new repayment amount is agreed. This is normal and nothing to worry about.

As soon as we have received your signed Letter of Authority and your first payment, you can tell your creditors to contact us. We will then be happy to deal with all letters and phone calls for you. Please note that we cannot guarantee that creditors will permanently cease to contact you. They are still entitled to do so. Collection actions, including default notices and litigation could still occur and the cost of default notices may be added to the debt. If your creditors do contact you, do not ignore them. Please ask them to contact us.

How safe is my money?

We keep a separate Clients’ Account for all the money that we receive from our clients. The amounts that you agree are then paid out of this account to your creditors.

How quickly do you pay my creditors?

We will pay your creditors within 5 working days of receiving cleared funds from you.

How will I know my creditors are being paid?

You will continue to get statements from your creditors. As long as you keep up your payments to us, these statements will show payments from us. You will then be able to see how much we are paying to each of your creditors.

You can also ask for a statement from us at any time.

How will this affect my credit rating?

Because taking out a plan will result in you not making the contractual repayments on your unsecured debts, you should note that your credit rating will be adversely affected. This may affect your ability to obtain credit in the short and medium to long term, even after debts have been repaid. However, your credit rating most probably will have been already affected if you have missed or made late payments.

Can I pay more or less if I want to change payments from time to time?

The programme is flexible. If you want to make an extra payment one month, just call us to discuss how you want to do this. If your circumstances change and you need to increase or lower your payments, just get in touch so that we can talk about what you need to do.

Please note that it is important to maintain your monthly payments. If a payment is missed, your creditors may restart collection actions and add further interest and charges to your debt. Please get in touch with us immediately if you are struggling to make a monthly payment.

Do I need to change banks?

A lot of our clients worry about this. If you stay with a bank where you have credit facilities like an overdraft or loan, they may take steps to collect the money owed to them as soon as your salary or any other payment is paid into your account with them.

Because your programme operates by offering payments to your creditors that are based on how much you owe each one, then if your bank take their full payment, you will not be able to make reasonable payments to your other creditors.

You should think about opening another account with no overdraft attached to it. This will give you more control over your money and will make sure that all your creditors get fair payments. If some of your creditors see that they are not getting a reasonable payment they may not agree to take part in your programme.

Our advisers will give you any advice you may need on how to change bank accounts.

Do I need to cancel my direct debits?

As soon as you have agreed your programme you should cancel all standing orders/direct debits to creditors on the programme, taking care to ensure that any payments to priority creditors such as mortgage, council tax, water rates, gas, electricity etc, are maintained or re-arranged.

Is this a loan?

At Money Village we look for the best solution for you. Our debt management programme is not a loan. If you take out any more loans you will be increasing your debts. We rearrange your existing debts into smaller payments that you can afford more easily. Although we negotiate to try to reduce or freeze interest rates, you should be aware though that sometimes you may have to pay more interest in the long term.

What if I am not happy with the service?

We aim to provide a professional service at all times. However, if you are unhappy with the service that you’ve received, please follow our complaints procedure (click here to download), explaining why you feel that we have not met your expectations. We will contact you straight away to discuss this.

Cooling Off period

You may cancel the agreement at any time during the first 14 days in writing or by telephone, and we will refund any fees you have paid to us. We will not refund any payments that have already been made to your Creditors.

Are you governed by any regulations?

We are members of the Debt Managers Standards Association (DEMSA). This means that you have a Code of Conduct to protect you.

What happens to my information and records?

All correspondence to do with your programme (including letters to and from you or your creditors) will be kept by us for as long as your programme is operating.

When your programme ends, we will, if you ask, send all this paperwork back to you. You must tell us in writing during your programme or when it ends.

If you do not want your paperwork back, we will store it safely for twelve months and we will then destroy it.

How long will a Debt Management Plan last?

The following is a typical example of the total fees that could be payable and how long a plan may last:-

Assume a client with 7 separate debts totalling £12,500. Money Village has performed a detailed assessment of the clients’ financial circumstances, leaving him with appropriate allowances for expenses. After this Fact Find, Money Village has calculated that repayments of £200 each month can be comfortably afforded.

For the 1st 3 months, £165 of the monthly payment will be retained as payment of the initial fee. The remaining £35 would be paid to the creditors (£5 per debt in this example). After this initial period, we will deduct our monthly management fee of £40 (as there are more than 4 debts) and pay £160 to the creditors.

Monthly Payment

Initial Fee Amount

Monthly Management Fee

Amount paid to creditors

Payments in the 1st 3 months

£200

£165

£0

£35

Payments from month 4

£200

£0

£40

£160

In this example it will take our client 81 months to repay the debt. They will pay Money Village an Initial Instruction Fee of £495 and Monthly Management fees totalling £3,120. The total amount paid to Moneyvillage during the life of the plan will be £16,115 of which £3,615 relates to fees with the remainder being sent to the creditors.

This illustration assumes that the creditors will freeze interest and charges on the debts. Although we are able to negotiate this in the majority of cases, we cannot guarantee that this will happen.

Warning – if we negotiate lower payments to your creditors, this will increase the amount of time it takes to repay your debts and the total amount that you repay.