DMP Mutual Support Thread - Part 12

100kdeep wrote: »

hello again everyone

quick question if creditors dont need to see a payslip when doing a self-managed dmp what is to stop me from putting a very low amount for my income to get to payments as low as possible?
if i only earn my basic salary every month i wouldn't be able to afford my house hold bills nevermind pay off 100k debt. so if i made my i & e only leave £500 a month for creditors (10 in total ranging between 5 and 20 k ) it would granted take me 17 years to pay off (if it was interest free) but in reality i would have spair money to start offering sensible f and f in 2 - 3 years.

are creditors likely to except 0.5 percent of the balance as monthly payments without deciding to take me to court and get the 10 percent equity we have in the house?(morgage is joint so technically only 5 percent)

i am hoping to come out the other end without ccjs as i do work in finance sort of and althought getting them wouldnt mean losing my job it would make it hard to move companies in the future.

having read your diary january i would love to know what your thoughts are?

I like the way you're thinking.

To give some sort of guidance, I see a lot of defaulted debts (I am a debt adviser with CAB). I still see very few court claims. Most of those I do see are from the water authority.

I do see some from debt buyers (Lowell and Cabot come to mind) and the trend is increasing.

Debt buyers tend to start court action when the debtor is (a) not paying anything and (b) when it has been 4-5 years since the last payment.

You would think homeowners get more claims than those in rented accommodation, but I've not noticed that. You'd be unlikely to get a court claim if you are engaging with them and making payments, though I can't say it never happens.

If it did happen, and you had a savings pot to dip into, you could pay it off within a month and it would not appear on your credit file.

You're also asking if a creditor with a £3000 debt would accept £15 a month. You will find the answer is 'yes, if justified by a believable financial statement'

100kdeep wrote: »

hello again everyone

quick question if creditors dont need to see a payslip when doing a self-managed dmp what is to stop me from putting a very low amount for my income to get to payments as low as possible?
if i only earn my basic salary every month i wouldn't be able to afford my house hold bills nevermind pay off 100k debt. so if i made my i & e only leave £500 a month for creditors (10 in total ranging between 5 and 20 k ) it would granted take me 17 years to pay off (if it was interest free) but in reality i would have spair money to start offering sensible f and f in 2 - 3 years.

are creditors likely to except 0.5 percent of the balance as monthly payments without deciding to take me to court and get the 10 percent equity we have in the house?(morgage is joint so technically only 5 percent)

i am hoping to come out the other end without ccjs as i do work in finance sort of and althought getting them wouldnt mean losing my job it would make it hard to move companies in the future.

having read your diary january i would love to know what your thoughts are?

Hi

I totally agree with Fatbelly - send in a believable I&E and creditors/DCAs will accept whatever you offer. For the last year I have been paying £1 a month on each of our debts. The highest single debt is pushing close to £20k and they have accepted £1 per month indefinitely based on our I&E. All of our creditors have.

I haven't sent in any evidence but explained the drop in income as due to a change in circumstances. I haven't sent in supporting evidence.

I hopefully have enough saved for F&Fs to cover the eventuality that any single creditor decides to push for court action (although nowhere near £20k :rotfl:). However, I believe that correspondence would occur a long time before any situation got that far.

I keep creditors updated. Without them requesting it I now send them updated I&E every six months whether they ask for it or not. I do not offer or send any supporting evidence. One creditor asked for it once - I ignored the request and they've never come back to me. They've all written and accepted the monthly token payment and say it will be regularly reviewed. I don't know how long they will put up with this token payment but I'll keep doing this for the entire time they do. At the moment I have it in writing from all of my creditors that my next review will be in January 2018 - so I am okay with £1 per month for the next 6 months.

I started in January 2015 with £95k debt. I now have £49k debt because of unenforceable CCA and F&Fs (with a 'relative' putting up funds for F&Fs). I'll keep plodding through and pushing for either of those (or anything else I can find to clear down my debt balance).

We have more than £250k equity in our house. No creditor has ever mentioned our home or putting an order against it. It's not something I worry about.

I spent year one of my DMP learning to budget and making agreed DMP payments through Stepchange. During year one I read up and learnt whatever I could about CCAs, F&Fs, my rights - I even read the Lending Code:rotfl:. I changed my attitude to clearing my debt in Year two and decided to play the game - because it really does feel like a game of strategy. Creditors/DCAs make a move and I make a counter move and vice versa. Know the rules and stay within them and you can move to a winning position faster than someone who is not aware of the subtleties within those rules which are allowed, e.g. the token payments & CCAs etc.

Another example where creditor place AP/AR markers rather than default we have successfully argued that they are treating us less favourably than customers who pay nothing and make no attempt to deal with their debts. Those customers would be defaulted promptly and records of defaults would disappear from credit files after 6 years - whereas putting AR markers on our files meant we were being penalised for trying to deal with our debts. We won the argument every time we used it.

I'm not being flippant - I know owing massive debt and trying to pay it back is not a game. I know some people frown upon people paying back less than they borrowed. I know that I made massive mistakes and the finance industry induced me and helped me to keep borrowing. I was stupid and didn't say no and I consolidated more than once - someone should have said hang on you would be better of investigating a DMP or something similar. No-one did and I found out about DMPs from this forum.

I am a much happier person having no credit and I actually love being able to put money towards clearing my debts at less than the balance outstanding. If that makes me a bad person then so be it - I can live with that.

Sorry for the long post but I hope this helps.
Jan

Edit: If anyone wants to take this hard line route they need to be prepared to deal with it and any fall out that may (or may not) come. I don't think we've had any fall out from creditors but I took this hard line route with the knowledge that I only had myself to blame if anything went wrong for us. Every creditor/DCA is different. I can only report my experiences based on the creditors we have.

fatbelly wrote: »

That's an excellent post!

If you mean my post - thank you kindly :beer:

If you mean someone elses.....which one

Seriously - throughout the first year of my DMP I was learning from yourself and Sourcrates mostly, but some others as well. I cannot thank you enough for the brilliant, continuous advice.

:beer:

Julie67 wrote: »

Fantastic post January Thank you.

I'm planning on going down a very similar route. We had four years with SC on a DMP never missing a payment.
It's only after reading this wonderful thread that I had the courage to go self managed in May this year.
I had no idea about CCA's again until reading about them here.
We have written to all six creditors requesting CCA's. Two have come back unenforceable so far and the other four have put the accounts on hold whilst they find them. So 7 weeks and still waiting.
For those that come back enforceable I will be paying £1 per month for at least the next 12 months whilst we get together a good emergency fund and build up some money for F&F.
As you said I will deal with any problems as they arise but I think as long as you keep people informed of your intentions they seem fine
I couldn't have done it without the advice on here and we have a long way to go but feel so much more in control and proactive.

Julie - was it you who mentioned you had a BC account unenforceable - but a BC account post 2008? I think from memory it was from 2012 (ish). I can't find the post though. We have a 2008 BC account which I've just CCA'd - I'm probably chasing down rainbows but I'll keep trying.

If it was you - could you let me know why it was unenforceable please?

:beer:

Just to add, it was from 2011