DMP & Mutual Support Thread - Part 9

Hopelessly_Hopeful · 18 August 2013 at 10:15AM

andrar wrote: »

So did you pay off the credit card separately to you DMP? Did it cause any problems doing that or are you self managing your DMP?

I went self managed this year. I took a mortgage holiday break to get rid of M&S at 24.9% and 25.9% interest earlier this year. I am now paying the M&S allocated payment into the rest of the DMP. My personal view is to challenge and challenge and challenge them to stop interest in the first 18months and squirrel away to an emergency fund so you don't run the risk of destabilising the DMP until you are further down the road. But, as I said many have overpaid without consequence.

The other thing you could consider is not to pay it all off, just some of it, but leave a years worth of payments on the card so it doesn't ring the same alarm bells with the DMP provider as you'd be carrying on paying the same DMP payment.

HHx

Hopelessly_Hopeful · 18 August 2013 at 10:22AM

andrar wrote: »

What do you mean by the 'worst happening' ?! Could I get in more debt or something if I try and make extra payments??

The DMP provider could say you aren't playing fair and cancel the DMP and creditors could start to reapply interest. They could start reapplying interest even if you don't overpay though, this happened to several f us that were just ploughing on with the DMP. They want us to be play fair but they don't - all because of the informal nature. You can challenge interest, some we win, some we don't.

The point you need to understand is that there are few rules because of the informality so the process is very inconsistent that's why we say you have to be comfortable with your chosen path as it would go either way.

HHx

andrar · 18 August 2013 at 10:25AM

Thanks for info - I didn't know if I overpaid when I was able to it would be a problem for them!

andrar · 18 August 2013 at 10:32AM

Hopelessly_Hopeful wrote: »

.

The other thing you could consider is not to pay it all off, just some of it, but leave a years worth of payments on the card so it doesn't ring the same alarm bells with the DMP provider as you'd be carrying on paying the same DMP payment.

HHx

PS sorry not sure what this means - I only have the DMP debts, no other cc's or loans, and the cards don't exist anymore so no access to further debt at all?

Hopelessly_Hopeful · 18 August 2013 at 10:37AM

andrar wrote: »

Thanks for info - I didn't know if I overpaid when I was able to it would be a problem for them!

It may or may not that is the dilemma as there are no certainties!

HHx

Hopelessly_Hopeful · 18 August 2013 at 10:39AM

andrar wrote: »

PS sorry not sure what this means - I only have the DMP debts, no other cc's or loans, and the cards don't exist anymore so no access to further debt at all?

The DMP is not a separate debt - it is made up of cc or loans even if we are no longer using them etc. Hope that makes sense.

HHx

Time_to_face_the_music · 18 August 2013 at 11:03AM

andrar wrote: »

Question - I can't get two of my creditors to stop charging me interest. If I pay extra money to payplan they have told me they have to distribute evenly across all my creditors and not just snowball them.

If I take my overpayments and pay the creditors who are charging me interest direct (thus reducing interest I need to pay and hopefully reducing time it takes to pay it) will this cause me any problems? Will payplan be annoyed? Will it mess up my psyments eg I could end up overpaying if payplan don't keep track of what's left to pay - or do the creditors speak to payplan when the debt is near an end?

Thanks for any help you can give!

Our DMP is self managed now but we started off with CCCS, now StepChange, and I always paid extra to creditors charging interest then amended my online balances. I did this for 9 months and StepChange never complained but it is a risk because it can be seen as treating your other creditors unfairly.

How long have you been in DMP?

Have you officially complained to creditors charging interest?

If you have, did you follow this up with a complaint to the FOS?

If you haven't made official complaints before, do it now and ask for past paid interest to be refunded. If you don't get the answer you want, take the complaint to the FOS.

If you are confident enough to do it and willing to play hardball with these creditors, move to a self managed DMP and give them token payments of £1 a month until they default and transfer the debt to a DCA.

If you need any help with template letters or advice on transferring to self managed, just ask. Good luck

andrar · 18 August 2013 at 11:03AM

Hopelessly_Hopeful wrote: »

The DMP is not a separate debt - it is made up of cc or loans even if we are no longer using them etc. Hope that makes sense.

HHx

Yeah I know that, I just see it as one a monthly payment. I didn't understand the part about not paying it all off and leaving a years worth of payments on a card - I don't have a credit card? And surely I need to commit to paying off my DMP.

Anyway I think my original question was kind of answered - I'll keep paying off the extra when I can and I'll speak to payplan to see if they would have a problem with me paying the extra direct to the creditors who are charging me interest. thanks!

andrar · 18 August 2013 at 11:09AM

Time_to_face_the_music wrote: »

How long have you been in DMP? Since November 2012

Have you officially complained to creditors charging interest? No, just through payplan

If you have, did you follow this up with a complaint to the FOS? No what does FOS stand for?

Sorry for all the questions - I guess this is the next step on my DMP journey and its all new to me!

Time_to_face_the_music · 18 August 2013 at 11:19AM

andrar wrote: »

Quote:
Originally Posted by Time to face the music

How long have you been in DMP? Since November 2012

Have you officially complained to creditors charging interest? No, just through payplan

If you have, did you follow this up with a complaint to the FOS? No what does FOS stand for?
Sorry for all the questions - I guess this is the next step on my DMP journey and its all new to me! Sorry for all the questions - I guess this is the next step on my DMP journey and its all new to me!

This thread is here for questions and the support offered is what it is all about. There can never be too many questions and no question is daft .... if it is, I have already asked it!

OK you need to make a complaint to your creditors direct. Try something like this, customising it for each creditor:

You

Date

Them

Dear Sir/Madam

Re: [Creditor name] account No: XXXXXXXXXXXXXXX

Thank you for your letter/statement concerning the above account. I am sorry that you feel unable to suspend interest/charges on the above account.

As you are aware, I/we am/are in a DMP with XXXXXXXX, reference number XXXXXXXX. The majority of my/our other creditors have agreed to the offer of payment and agreed to suspend any interest charges still accruing. They have accepted that to continue to charge interest would not assist us in my/our present financial difficulties, and can only serve to increase my/our total debt.

I/we have already paid considerable sums in interest to my/our account. If interest charges continue, the monthly instalments I/we am/are paying will not even cover that interest. Also, the cooperation of my/our other creditors who have agreed to freeze interest already would be put at risk.

I am aware that XXXXXXX subscribes to the Lending Code which states that lenders will consider reducing or suspending interest and charges if these would cause the debt to increase or lead to the repayment term becoming too extended. I would therefore be grateful if you would reconsider your decision not to freeze the interest. This would mean that the monthly payments I/we make would actually reduce the balance outstanding to your company.

Please consider this letter as a complaint about the interest charges you are continuing to apply to my account. I would like to see these stopped immediately and previous interest charges refunded.

If you are unable to help me with this issue, I will have no alternative but to take this case to the Financial Ombudsman Service.

I look forward to hearing from you as soon as possible.

Yours faithfully

You

You can also contact the Financial Ombudsman Service (FOS) at the same time but they won't contact your creditors on your behalf until 56 days have passed since your original complaint. If you tell them you have already complained via Payplan, they may do this quicker. Check out:

http://www.financial-ombudsman.org.uk/consumer/complaints.htm

DMP & Mutual Support Thread - Part 9

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