There are two main advantages for using a DMC:

Advantages

• The borrower does not get involved in negotiations with their creditors.
• Only one monthly payment to the DMC - borrower feels the debt is under control.

Disadvantages

• Any rescheduling of debts will most definitely affect the borrower’s credit rating.
• The creditor does not have to accept the revised payment.
• Debts may increase due to the additional fees and any creditors’ reluctance to freeze interest and associated charges.
• Creditors are not legally bound by the arrangement and can refuse your offer and not deal directly with the DMC. In some instances they may take legal action to recover their losses. 
• The borrower may still receive communication from a creditor.

Example when not to use a DMC

• If the repayment period is unrealistic due to the high level of debts compared to the monthly payment and an IVA would reduce the term down to 60 months.
• If creditors refuse to freeze interest and stop associated charges whereby the level of debt is increasing.