Working out which debts can go in a Debt Management Plan, and which can’t, is one of the most confusing parts of setting one up. A DMP handles unsecured debt through one affordable monthly payment, but not everything you owe will qualify. Getting this wrong from the start can cause real problems once your plan is underway.
This guide covers what typically can and can’t be included in a UK DMP, and what to weigh up before you set one up. By the end, you’ll know exactly which of your debts belong in the plan, and which need handling separately.
What are the Debt Types that CAN Be Included in a Debt Management Plan?
A Debt Management Plan(DMP) is built around unsecured, non-priority debts, ones without an asset attached and where missing a payment won’t put your home or essential services at immediate risk. The following are the debt types that can typically be included in DMP:
1. Credit Card Debt
Outstanding credit card balances are one of the most common debts included in a DMP. As unsecured lending, most credit card providers are willing to accept reduced payments once you’re on a plan, and interest or charges may be frozen depending on the creditor.
2. Personal Loans
Unsecured personal loans taken out through banks, lenders, or finance companies can usually be included. Because there’s no asset backing the loan, these creditors are typically more flexible about accepting a lower monthly payment through your DMP provider.
3. Store Cards and Catalogue Debts
Balances owed to retail stores or catalogue companies are treated the same way as credit cards. These are unsecured debts, so they’re generally straightforward to include, though acceptance still depends on the individual creditor agreeing to the plan.
4. Overdrafts
An overdrawn bank account is considered unsecured debt and can usually be added to your DMP. It’s worth confirming with your bank directly, since some may treat overdrafts differently depending on whether the account is still active.
5. Utility Arrears
Arrears on gas, electricity, or water bills can sometimes be included, depending on the provider and whether your service is still connected. You’ll still need to keep your current monthly bills paid to avoid disconnection while the arrears are managed separately.
6. Payday Loans and Short-Term Borrowing
Payday loans and other short-term borrowing are unsecured and can typically be added to a DMP. Including them stops further high interest from building while your provider negotiates a more manageable repayment rate with the lender.
7. Old Mobile Phone Contracts
Debts from mobile contracts that are no longer active, such as an unpaid final bill after switching providers, can usually be included. Since there’s no ongoing service at risk, these are treated as straightforward non-priority debt.
8. Benefit Overpayments
Overpaid benefits can sometimes be included, but only if they’re not already being recovered directly through deductions from your current benefit payments. If recovery is already happening automatically, it typically needs to stay outside your DMP.
9. Credit Union Loans
Unsecured loans from a credit union can usually be included in your DMP in the same way as a personal loan. Check with your credit union directly, as smaller lenders sometimes have their own process for accepting reduced payments.
10. Additional Debt Types
A few other unsecured debts can sometimes be included too, such as debts already sold to a collection agency, or informal credit arrangements with smaller lenders. Always confirm with your DMP provider, since acceptance ultimately depends on each individual creditor.
Need More Help Deciding Which Debts Belong in Your DMP?
Working out which of your debts qualify, and making sure your priority debts stay protected, isn’t always straightforward. If you’re unsure how a DMP would apply to your situation, fill out the form below and we’ll get back to you with your options.
We’re here to support you every step of the way.
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What to Check Before Adding a Debt to Your DMP?
Before setting up your DMP, it’s worth reviewing your finances properly rather than adding debts on autopilot. Not every debt qualifies, and getting this wrong can cause problems once your plan is underway. Here’s what to check first:
| Check | Why it matters |
| Are your priority debts covered? | Make sure your budget covers rent or mortgage, council tax, and utility bills before anything else. These must always come first. |
| Is the debt unsecured and non-priority? | Only unsecured debts, ones not tied to an asset, belong in a DMP. Secured or priority debts need separate arrangements. |
| Will the creditor accept it? | A DMP is informal, so creditors aren’t obligated to participate. Most unsecured lenders agree to a fair offer, but it’s worth confirming rather than assuming. |
| Is the debt actually in your name? | Additional cardholders aren’t responsible for the main account holder’s balance, so check whose name a debt is really under before including it. |
| Is it a joint debt? | Both parties remain responsible for the full balance on a joint debt, so think through how including it might affect the other person. |
| Do you have a full list of everything you owe? | Include account numbers, balances, and creditor names for every debt, so nothing gets missed or duplicated once your plan starts. |
Taking the time to check these points helps you build a DMP that covers the right debts from the start, without disrupting your priority payments or catching a joint account holder off guard.
Important Note: For the full list of debts that generally can’t be included, see our guide to which debts can’t be included in a DMP.
What Happens If You Include the Wrong Debt in Your DMP?
Including a debt that shouldn’t be in your DMP, or leaving out one that should, can cause real problems once your plan is running.
If you add a priority debt like your rent, mortgage, or council tax instead of paying it separately, you risk serious consequences such as eviction, repossession, or court action. These debts need to stay outside your DMP and be paid in full, on time, regardless of what you’re contributing to your other creditors.
Leaving out an eligible unsecured debt causes a different kind of problem. That creditor won’t be part of your plan, so they can keep charging interest and contacting you directly for payment. This makes your overall debt harder to track and can slow down your progress toward becoming debt-free.
Mistakes can also affect your credit file. Even when your DMP is set up correctly, accounts included in it may be marked as being under an arrangement, which can lower your credit score. This is usually temporary, but it can make it harder to access credit until your DMP is complete and your debts are settled.
Getting the right debts into your DMP from the outset, and keeping priority debts separate, is what keeps your plan realistic and avoids these kinds of issues further down the line.
How to Add the Right Debts to a DMP: Step-by-Step
Getting your DMP set up correctly starts with a bit of preparation. Here’s how to approach it:
- Build Your Budget First: Review your income and essential expenses, rent or mortgage, council tax, utilities, food, and travel. Whatever’s left over after covering these is what you can realistically put towards your unsecured debts each month. A DMP should never leave you short on essentials.
- List and Categorise Every Debt: Write down everything you owe, including the creditor’s name, the balance, and the account reference. Split each one into unsecured/non-priority (credit cards, loans, overdrafts) or secured/priority (mortgage, rent, council tax, car finance). Only the first group belongs in your DMP.
- Choose a Provider or Manage It Yourself: A free provider, such as StepChange or PayPlan, can negotiate with creditors and handle payments on your behalf. Managing it yourself gives you more control but means dealing with creditor communication directly. Most people find a provider easier.
- Contact Creditors With a Fair Offer: Once your budget’s ready, reach out to each unsecured creditor and explain your situation. Many will accept a reduced payment if you’re transparent and consistent about what you can afford.
- Review Regularly: Revisit your budget every few months or whenever your circumstances change. If your income rises, you can offer more. If new unsecured debts appear, speak to your provider about adding them.
Are You Looking to Set Up Your DMP the Right Way?
Now you know the steps, but going through them with an advisor can help make sure nothing’s missed, and that your priority debts stay properly protected from the start.
We’ll help you explore all the debt solutions available for your situation, so you can make an informed decision.
Get in touch with us to find out what solutions may be available to you, or call us on 01204 890 760 to speak to an advisor today.
Need help with debt?
Use our online debt form to explore options
that may suit your debt situation.
Need help with debt?
Use our online debt form to explore options
that may suit your debt situation.
[Important Note: For additional independent guidance, you can also access free resources from MoneyHelper, the UK’s official platform for managing debt and finances.]
Final Thoughts
A Debt Management Plan in the UK works by repaying unsecured, non-priority debts through one affordable monthly payment. Credit cards, personal loans, overdrafts, payday loans, store cards, catalogue debts, and certain utility arrears usually qualify. Priority and secured debts, mortgages, rent arrears, council tax, secured loans, generally don’t, and need to be managed separately.
Getting this right comes down to a few things: knowing which debts actually qualify, staying on top of your priority commitments, and building a budget you can realistically sustain. Everyone’s situation looks a little different, so it’s worth reviewing your debts properly and getting professional guidance if you’re not sure where something fits.
By including the right debts and keeping your plan up to date, a DMP can provide a structured path towards reducing debt and regaining control of your finances.
Key Takeaways
- A Debt Management Plan (DMP) is designed primarily for unsecured, non-priority debts.
- Credit card balances are among the most common types of debt that can be included in a DMP.
- Unsecured personal loans can usually be added to a DMP to make repayments more affordable.
- Store card and catalogue debts are generally eligible for inclusion because they are unsecured debts.
- Bank overdrafts can often be included in a DMP, although policies may vary between lenders.
- Certain utility arrears may be included, but you must continue paying your current utility bills.
- Payday loans and other short-term borrowing can typically be added to a DMP to help stop further debt escalation.
- Priority debts such as rent, mortgage payments, and council tax should usually remain outside a DMP.
- Including the wrong debts or excluding eligible debts can lead to payment issues, creditor action, and delays in becoming debt-free.
- Reviewing your budget, identifying all debts correctly, and seeking professional advice can help ensure your DMP is set up effectively.
FAQs
Can all debts be included in a Debt Management Plan?
No. Only unsecured, non-priority debts, such as credit cards, personal loans, and overdrafts, can usually be included in a DMP. Priority and secured debts, like your mortgage, rent, or council tax, generally can't, since missing them carries more serious consequences and they need to be paid separately.
Can I include a joint debt in my DMP?
Yes, you can include your share, but both parties remain fully responsible for the full balance. Your creditor may still contact the other person for repayment, and including it can affect their credit file too. It's worth discussing this with them before adding a joint debt to your plan.
Can a debt sold to a collection agency be included in a DMP?
Yes, in most cases. If your original unsecured debt has been sold or passed to a collection agency, it's usually still eligible for inclusion. Your DMP provider will need the collection agency's details rather than the original creditor's to add it to your plan correctly.
Will creditors contact me while I'm on a DMP?
They can, though contact should reduce once your DMP provider notifies them and payments are being made consistently. A DMP is informal, so creditors aren't legally required to stop contacting you, but most will scale back communication if they see you're sticking to the agreed plan.
