DMP/Bankruptcy...DILEMMA! Any help appreciated

Davemac · 14 October 2008 at 6:39PM

I've used this excellent site before for minor financial advice, but am desperate to get more opinions on what is a major dilemma for myself right now. I have looked at some recent posts/threads, but none that I have found seem to answer my specific queries.

Basically, I owe roughly 29 grand on credit cards, not counting £2,500 worth of overdrafts. My student loans are secured (and deferred!) so aren't part of the problem.

I have not worked for 6 months, although I hope that situation will change soon as I am actively seeking employment. I have juggled money between cards and current accounts to pay minimum payments, which are now out of control and totalling nearly £600 per month. I know I should have done something about this sooner, but it's too late to beat myself up about that now.

Having had no luck with my creditors when asking for a Reduced payment plan (Virgin/MBNA told me that "things might change tomorrow and you could get a job!". Great, thanks. Might win the lottery too or get hit by a bus), I made a decision to go down the bankruptcy route as a last resort.

I don't own my own home nor have any assets. I was advised by a respected solicitor that the impact on my parents (with whom I live) would be minimal, but it might be best to tweak their will (I'd mentioned that initially) in case one of them died before my discharge came through.

Just before I applied for bankruptcy, a friend put me on to a solicitors who advised me that ......a great number of credit cards and loans given out before April 1st 2007 were actually given out unlawfully and the banks had put aside 7 BILLION POUNDS to deal with the expected influx of claims- the idea being that these loans and credit cards could be wiped in total if indeed found to have been issued unlawfully.

I contacted the people in question and gave them details of 5 relevant credit cards. After a week, they rang me to say that they were willing to take on my claim and that - if successful - my debts could be wiped from those cards without any CCJ's. I would have to pay a £350 charge for each card, or £40 each month per card for one year. These claims however could take up to 6-9 months I've been told.

It's long winded I know, but bear with me please!.......

I then decided I might give this a whirl, but in the meantime, I realised I would have to keep making my minimum payments. The solicitor in question then put me on to a Debt Management firm, who seemed fairly straight and up front about the whole thing.

They told me they can get my payments down to one payment per month for £100 (I have this in writing) - ALL THE WHILE THESE CREDIT CARD CLAIMS ARE ONGOING. As seems to be the case, I've been told not to pay any creditors or enter into conversation with them. Red letters will come and creditors will doubtless make calls. What worries me is that these plans can take up to 3 MONTHS TO KICK IN.

Not only that, but there is no guarantee (and certainly no precedent that I can think of) that my claims will be successful and those particular debts wiped (I'll also still have £4500 worth of debt on other cards that I have gathered post April 1st 2007).

Bankruptcy is the last resort - and I cannot get an appointment at the local county court until December (although I have the forms here) - but even so, I want to be free of debt for good, despite the obvious flaws and 6 years without credit.

I am torn with what to do and don't know what is totally trustworthy and what is not. Before I send these DMP papers back signed, I am desperate for advice on what is a major headache for me. Just the thought of 3 months stress, hassle and harassment from creditors (not only for me, but more importantly, my parents if they answer any calls whilst I am out) really doesn't sit comfortably.

It seems a bit of a strange conundrum and I am admittedly struggling with what decision to take. The only positive I can think of with bankruptcy is that I will be guaranteed to be freed from debt by December and can start afresh.

Although there is a chance the other route(s) could still be successful, it seems long-winded and fraught with doubt.

Any advice (be it as honest, blunt and frank as you feel!) is hugely appreciated at this difficult time.

Many thanks indeed

Dave

Deep_In_Debt · 14 October 2008 at 6:45PM

Hi and welcome
You are paying £350 per card to have your debts wiped off? Firstly debts are never written off, they just become unenforceable. Secondly, you could do it yourself for a £1.00 PO and the cost of postage. Can you cancel this bunch of money making sharks?

Can you phone a free debt charity such as CCCS, CAB or National Debtline who will do what a debt company will do for FREE and in your interests only?

Deep_In_Debt · 14 October 2008 at 6:48PM

Sorry, I've got mashed potato for brains tonight!

Do not send back the dmp papers - as I've said, CCCS and CAB will provide the same service for free.

pepe2008 · 14 October 2008 at 6:51PM

DONT go paying this Co to 'remove' the CC debts as they will be relying on there not being a CCA in existence with the 'prescribed terms' if at all.

You can contact your CC's using a letter such as the template available on nationaldebtline.co.uk ( I'm sure others will provide via this forum ) with the fee of £1, yes £1 ( not £350 ) for each request for the CCA.

If they dont produce CCA within 12+2 days then the debt is 'in dispute' and cannot be enforced until the CORRECT CCA is produced. It doesnt disappear, but they cant chase it.

As always, dont act on any advice unless you've checked it with the professionals, eg CAB, NationalDebtline etc

Good Luck

RAS · 14 October 2008 at 6:55PM

I hope that you are not paying this solicitor as well? really he has not done you any great favours.

Please ring one of the debt charities here http://www.moneysavingexpert.com/loans/debt-help-plan#help

They run debt managment plans for no fee. So your whole payment goes to the debt rather than the managment company. And in the interim, you send a letter and token payment to keep the creditor informed.

Secondly, it cost £1 to request a CCA plus the cost of the registered letter, and you know within three weeks whether there is a good chance that they do not have the paperwork required to enforce the debt.

How long soince your contracted with this mob? And are you ware that the OFt have a warning out about these companies?

Davemac · 14 October 2008 at 7:06PM

Thanks for the advice so far. Much appreicated.

I have not sent anything back SIGNED to the Debt Managment company - thus as yet, they will be unabe to enforce the DMP.

I had filled out the forms for the prospective claim with the solicitor in question, but as I am aware, the claim has not started yet.

I do indeed need to ring one of those debt charities. Thanks.

RAS · 14 October 2008 at 7:08PM

The Office of Fair Trading and the Ministry of Justice have issued a WARNING about companies/people offering these services, their fees and their claims.

Claims regulator and OFT warn consumers about risks of being misled over the enforceability of consumer credit agreements

There is a whole thread on these companies that I have just boosted to teh top of the page. The last post explains how to make a CCa request - your whole lot will cost £10 rather than £2000.

It may or may not work for you, some people have had £30,000 plus made unenforceable, others have every same debt properly documented.

Deep_In_Debt · 14 October 2008 at 7:14PM

If you are worried about creditors calling, it may be worth sending them token payments of £1.00, £5.00 etc (whatever you can afford) as a gesture of good will until you get something sorted. I think there is a standard letter on the National Debtline website that you can download and use.

You don't have to answer the phone to them and if you do, don't go through their security questions. There is also a letter somewhere where you can ask them to contact you in writing only. Don't get stressed by the calls and don't let your parents get stressed either. If you don't have it, they can't have it.

Ditch the solicitors if you can and also the fee charging bunch of sharks.

RAS · 14 October 2008 at 7:18PM

DID

You mean this? Fourth outing this evening!

Nicked from fermi

You need to send a letter telling all the creditors to stop telephoning you. It may take time to take effect.

So send this first letter registered post. If they make any further calls after it is signed for, send the second letter and copy in the Information Commisioner, the OFT and the Trading Standards office nearest the debtor's office.

No it is guaranteed to stop them but if you

1.Point out it is your right under the OFT Guidelines.
2. refuse to answer security questions.
3.Advise them that you are recording the call

they will take the hint.

Phone letters from fermi

Something along the lines of:

Quote:
Dear Sir / Madam,

Re accounts ref

I do not acknowledge any debt to your company.

I am writing to you to inform that I request all communications to me in writing. I do not want any further telephone calls made to me ( my mum).

To continue to contact me by telephone after I have requested you not to constitutes harassment. I require all future communications in writing for future Court use. Do not telephone me again – remove any telephone numbers you hold for me from your systems.

Your telephone calls are in breach of the Office of Fair Trading guidelines. If you continue with them after the receipt of this letter, an official complaint, together with a log recording the times and frequency will be passed both to that office and to Trading Standards, For your information, all telephone calls are taped.

This type of debt collection method is contrary to the ‘Administration of Justice Act 1970’. In that it is intended to cause alarm and distress to the recipient. Your methods will not be tolerated. A formal complaint to the relevant authorities will be made.

Take further notice that continued telephone calls after receipt of a request not to call may constitute a criminal offence under Section 127 of the Communications Act 2003. Continued phone calls to my mother may also constitute an offence under the Data Protection Act.

Communicate in writing and ONLY in writing. Your telephone calls will not be answered.

HOWEVER, CALLS WILL TRIGGER COMPLAINTS TO THE REGULATORY BODIES.

I trust I have made myself understood on this matter.

Yours,

A list of good contacts to whom you can complain formally if they make a nuisance of themselves.

Here are pipk62's list of websites for the organisations .

These addresses are the ones that I have used to find the information that I required, You may want to research pages other than the ones I have linked to, try clicking on the home page if any of these aren't what you wanted.

Office of Fair Trading, Contact page: http://www.oft.gov.uk/contactus

The Information Commissioners Office, Complaints page: http://www.ico.gov.uk/complaints.aspx
(note: I chose to complete and download the .pdf form on Data Protection, which I am also sending to the other offices, with an accompanying letter)

Trading Standards, Central office homepage: http://www.tradingstandards.gov.uk/
-Please note, you can search by inserting the postcode in the top right hand corner, remember to use the postcode of the DCA rather than your own-

Consumer Credit Association, enquiries page: http://www.ccauk.org/consenquiries.htm

the Financial Ombudsman Service, Contacts page: http://www.financial-ombudsman.org/contact/index.html

Members of parliament list, (as provided by RAS): http://www.parliament.uk/directories/hciolists/clomps.cfm

And then if you get any more calls:

Quote:
Dear Sir/Madam,

Ref. 1234567890

Despite my letters regarding ANY communication from your company, which stated that I require ALL communications in writing, your telephone calls continue.

This behaviour constitutes harassment; the letters stated quite clearly to you that I require ALL communications in writing for future Court use. Do not telephone me again - remove any telephone numbers you hold for me from your systems.

Your telephone calls are in breach of the Office of Fair Trading guidelines. If you continue with them after the receipt of this letter an official complaint, together with a log recording the times and frequency of the calls will be passed both to that office and to the Trading Standards office. For your information note that ALL telephone calls are taped.

This type of debt collection method is contrary to the ‘Administration of Justice Act 1970’ in that it is intended to cause alarm and distress to the recipient. Your methods will not be tolerated. A formal complaint, containing copies of all correspondence including yours, has now been submitted to the relevant authorities. This will be relevant to questions of your fitness to hold a licence under the Consumer Credit Act, whether or not it results in a prosecution.

Take further note that continued telephone calls after the receipt of a request not to call may constitute a criminal offence under Section 127 of the Communications Act 2003.

Communicate in writing and ONLY in writing, your telephone calls will NOT be answered.

HOWEVER, CALLS WILL TRIGGER COMPLAINTS TO THE REGULATORY BODIES.

I trust that I have made myself understood on this matter,

Yours faithfully,

Deep_In_Debt · 14 October 2008 at 7:24PM

RAS

Yep, that looks like the one I was thinking of. Will obviously need amending a according to circumstance but it stopped the majority of my calls.

pimmyccfc · 14 October 2008 at 7:28PM

hi i would strongly suggest contacting your local CAB. I had debts amounting to £28500 and CAB contacted all my creditors for me,stopping all threatening correspondence from them, and after exploring all possible avenues it was decided the best course of action was bankruptcy. CAB filled all forms for me,and this was all free of charge,so please seek advice from these people before paying a debt management company,who in some cases will take your money but still leave you in debt

DMP/Bankruptcy...DILEMMA! Any help appreciated

Comments

Confirm your email address to Create Threads and Reply

🚀 Getting Started

Categories

Is this how you want to be seen?

Get our FREE Weekly email full of deals & guides - and it’s spam-free