Latest figures produced by the Chiltern Debt Management group show that the average size of debt from those currently in a debt management scheme currently stands at £26,500, which is owed to an average of eight creditors. However, the average income of those being helped stood at £23,416 with only 18% of that sum left over to pay debt when essential living costs were deducted.
Debt management schemes are informal arrangements, in which a third party acts as an intermediary between an individual and their creditors, and the amount taken out has been on the increase over the last few years. The debt management company helps an over-stretched borrower agree what they can realistically afford to repay each month to their creditors, and then collects a single payment from the individual before distributing it to the creditors. To help the process creditors agree to suspend applying interest and other charges. Click to continue »