The short answer to this is ‘badly’ as it invariably means a number of missed payments – recorded as a sequence of numbers on your credit file – and obtaining credit from high street lenders will be impossible. The word ‘arrangement’ might also appear on your credit file, indicating that you required help restructuring your debt.
The only way to correct this malaise is to somehow pay the outstanding debt and get a letter (s) of satisfaction from the lender (s) and submit this to the credit reference agencies. If you were to do this, the magical word ‘satisfied’ would appear next to the creditors on your credit file and your rating would improve markedly.
‘How does a DMP affect my credit rating’ is just one of hundreds of questions we’ve answered over the years, but feel free to call us on 01425 600129 if you need to know more or need bankruptcy help. Our staff are ex-financial services and have the experience to get you the best result every time.