Hi Kezza, interesting post, this is clever marketing and shows that the banks are worried about IVAs and are actively looking to get people using DMPs instead. Look at recent press coverage to see that banks are trying to stop the rising tide of IVAs.
A DMP can be whatever the creditor makes it so technically it could have interest rates frozen and it could be paid over 5 years (or even less), but it ISNT legally binding so you could find that after a year they change their mind. They are obviously using those keywords because those are main points in an IVA (interest rates frozen and fixed to 5 years). I should say at this point that DMPs are great in certain circumstances (usually lower debts) and should always be considered prior to an IVA. However they DO NOT write off debt (which IVAs do) so they will nearly always be longer than IVAs to complete.
The IP fees is an interesting issue because they are trying to spin the fact that it is actually the banks that pay the fees (the person doing the IVA usually pays no fees). Basically in an IVA the person pays what they can afford to reasonably pay into a pot, fees are taken out of this pot, and then the creditor gets whatever is left at the end of 5 years.
There is nothing illegal with that letter but it is certainly misleading. Perhaps you could scan it and email it in to us?
Kind regards,
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