DMP Mutual Support Thread - Part 12

Sorry, keep forgetting to reference the posts I am replying to - pregnant brain!

Summer12 wrote: »

Morning,
Further to my post above and some more research on debt camel (what a great web site). It seems that I was right if you have enough equity in your house then indeed unsecured creditors can request (and then subsequently take you to court for a charge on your house). Which leads me to the conclusion that I may aswell try the secured loan route even though it’ll cost me more,take longer etc before my credit file is trashed by a dmp as after starting one surely any loan offer (if at all) would be an even worse interest rate. Seems to be little difference in unsecured debts to secured debts action just that it takes longer to get there for the creditor. Any one had any experience of creditors threatening to put charge on their house/court action (or actually going ahead with it)? Thank you in advance, going to sleep thinking about it and first think I worry about when I wake.

Hi Summer, I did research before going down the DMP route. What i found out and was told is that a creditor can apply for CCJ which could attach the debt to your Equity. However this is just attached and will only come into force if you decide to sell it, they would then be entitled to whatever you owe from the proceeds of the sale. At no point can they take your house from you or force you to sell, its kind of like a guarantee for them.But from what i can read not many company's apply for CCJ's if you are on DMP Though can happen.

If you go down the secure loan route that is different and is secured against your home so if you default on that i think the outcome could be different. I rent so am not in the same situation. But thats my understanding. People feel free to correct me if wrong...

Summer12 wrote: »

Morning,
Further to my post above and some more research on debt camel (what a great web site). It seems that I was right if you have enough equity in your house then indeed unsecured creditors can request (and then subsequently take you to court for a charge on your house). Which leads me to the conclusion that I may aswell try the secured loan route even though it!!!8217;ll cost me more,take longer etc before my credit file is trashed by a dmp as after starting one surely any loan offer (if at all) would be an even worse interest rate. Seems to be little difference in unsecured debts to secured debts action just that it takes longer to get there for the creditor. Any one had any experience of creditors threatening to put charge on their house/court action (or actually going ahead with it)? Thank you in advance, going to sleep thinking about it and first think I worry about when I wake.

I would not recommend trying for a secured loan. You are just moving unsecured debt to secured debt. You are not solving any problems just making them far worse :eek:

Ok, so you found information which states that if you have enough equity in your house then indeed unsecured creditors can request a charge on your house. It is only likely to happen if you are not making any efforts at all to keep in contact with your creditors.

I am 3 years into my DMP. I pay only token payments. I have over a quarter of a million pounds of equity in my property which is almost 6 times the outstanding amount of my unsecured debts. All of my creditors are okay with token payments, not one has even mentioned securing a charge on my home, nor even mentioned they are aware of my equity value or anything similar - simply put they do not ever mention my home. We only discuss my income, expenditure and total unsecured debt value.

I have always been aware there is potential for charges on my home and for CCJs. When I entered the world of DMP I made it my goal to read all available information. I even read The Lending Code - now called The Lending Standards. Knowledge is power. I've said it many times before and I'll say it again. Debt management is a strategy game. Learn the rules, play the game by the rules and stay at least one step ahead of your creditors. Your will clear your debts, your home will not be at risk, you will not get CCJs, you may be able to negotiate F&Fs, you may find some debts unenforceable. You will win the game if you follow the rules. The winner gets to be debt free whilst staying within the law

Suseka97 wrote: »

I just want to pick up on two very good points Jan15 has made - and advice that the newbies into the DMP world should heed

1. It is extremely unwise to move unsecured debts into secured debts. You then do put your house at risk if at some point down the road you run into financial difficulty and a CCJ is pretty much bound to follow. Also - I speak from experience when I thought that was the best route out of my financial problems many years ago and consolidated all my 'then' debt into one big loan offered by the then First Plus and boy oh boy do I regret that. I'm not saying you'd be the same - but doing so didn't alter my lending habits and we ended up with a secured loan (which we are still paying) and having to enter into a DMP. Had I known about DMPs back then, that's the route I would have taken and I wouldn't be where I am today.

2. It is extremely important to do your research, yes - but you must get into your head this is a 'long game'. You need to be savvy and don't rush in making rash decisions just because creditors or DCAs appear threatening. Although your situation is unique to you - you are only a tiny drop of water in a very large pool of people under debt management plans. Creditors and their agents or DCAs have to treat you fairly and reasonably these days. Sourcrates has posted on more than one occasion why they have to behave nicely If you keep in touch (assuming the debts are proven to be enforceable), make a reasonable offer of payment and keep to that - things should chug along nicely.

Thanks for that Suseka :beer:

I think you made superb points especially that debt management is 'a long game'

For newbies hearing DMPs of 6 years, 9 years, perhaps more - we've all been there. For some of us that seemed like a lifetime at the start. For some of us, circumstances changed during the journey and some DMPs extend to 30 years :eek: We each choose to stick with our DMP for personal reasons, but we should always reassess our position during the journey and decide if DMP is still right for us. It could be that IVA, Bankruptcy, DRO etc. may be better, or not. Each case is individual. Life changes so the DFW journey changes. Don't be scared to deal with those changes as they come along - lots and lots of help on this fab forum:)

Whatever - don't be daunted by the initial length of your DMP. Life changes - roll with it