What is Debt Management Company Fee?
Debt management plan companies usually charge up-front fees, which is treated as an administration fee. They can also charge a percentage of the surplus that is left after the creditors are paid off. The fee-charging DMP company receives a larger fee, which is directly proportional to the amount to be paid to the creditors. These can result in the fee-charging DMP company making the debtor agree to a kind of arrangement which is not in the debtor’s interest. Sometimes, there are situations where the idea of bankruptcy looks like a better alternative, especially when the debts are large and the repayment extends into many years. Debtors do feel that the fees paid to the debt management companies could have been used to clear the debt if no fees were charged to the debtor. These fee-charging companies justify the fees with the enhanced support and administration services provided to the debtor along with the repayment plan. The fee-charging companies also provide creditor liaison departm
