Ask a CCCS counsellor a question

CCCS_Matthew

mysuni wrote: »

hi, i have sent all my creditors my income/expenditure sheet as advised by my cccs counsellor. i also sent the offer of token payment letter with a token payment. One of my creditors Lloyds TSB have defaulted me due to sporadic/non payment (2 cards) over the last few months. I have had letters from their solicitors and also now getting phone calls from MHA collections which i believe is there in-house dca. I sent the letter and token paymentsx2 on 25/2/09. i also asked for my phone number to be removed from file as i don't want calls all day everyday which is what the call centre have been doing. MHA have left a message asking me to urgently contact them. Letter from them dated 24th said i had to pay up arrears of £1335 IMMEDIATELY or else SCM solicitors may begin legal proceedings against me. so getting to the point finally do i call MHA and tell them all this or do i ignore them and wait for LTSB to inform them? And if i get ccj'd what can they do to get money from me if cccs have told me i can't afford my priority debts let alone c/c debts.

I would continue to offer a £1 gesture payment to MHA to show willingness to pay something towards the debt. If they choose to proceed with a CCJ, you would need to fill out the forms illustrating your priority expenditure exceeds your income, and offer £1 a month. If the judge feels that it's a reasonable offer given the situation you are in your offer will be accepted andf the creditor cannot pursue you for any more each month.

Hope that helps,
Matthew.

my_responsibility

Hello,

Firstly can I just thank you for your website. I had contemplated entering into an IVA until I completed the debt remedy on your website and am now awaiting the pack for a Debt Managment Plan. I have a couple of questions with regard to the Plan. I am currently on benefits, I have been awared these benefits until 2010, if in 2010 I loose my entitlement to these benefits what will happen with the plan, as on the website it stated that it will take to beyond 2010 to clear my debts? Will my payments be reassessed? Also, when hopefully my creditors agree to it, what way will my credit refernce file be affected?

CCCS_Matthew

MarieAnn wrote: »

Hi, my husband and I are just starting on a DMP with CCCS. I made the first payment on 1 March.

We have almost 40k worth of debt- through credit card and overdrafts.
We are not in arrears on any priority debts.

Are surplus is £285 a month which is about an 11year repayment period. However our creditors are refusing the plan and making demands of full and final payments etc. They are also refusing to freeze interest and most of them are accruing more interest per month than we are paying to them- therefore we have no chance of repaying the debt anyway. We have also stated that we will look to increase our payments where possible i.e. we are looking to take in a lodger, rebroke our mortgage to a lower interest rate etc. Also my husband has good career prospects and his salary will increase in the next few years. We have 3 pre-school children so I do not work at the moment but will be able to at some point in the next few years.

My main worry is that we will be forced to sell our house, although we do not have much/if any equity in it at the moment due to credit crunch prices.

Also how will this affect our credit rating for the future. Say for example, we payed of all the debt within 7 years and kept up with all our payments etc. What we be likely to be able to move house after that or would our credit rating be so badly damaged that we would not be able to get another mortgage for years?

Thanks.

Hi there.

Generally, you tend to find most creditors take a couple of months to accept the term of a DMP so you might still get demands for extra money for the next couple of months, but typically these demands become more infequent once the plan is up and running.

You're obviously doing the right kind of thing to improve the repayment time by increasing income and reducing expenditure which is as much as you can do. Your credit is likely to be affected if the creditors issue a default notice against you (which will stay on file for 6 years) and also the same for a CCJ should it ever get that far. This doesn't prevent you from getting further credit such as a remortgage at a later stage, but it may effect the likelyhood of you getting the best rates and products. It's really hard to say what extent though, as this really depends on the market and the behaviour of the lenders.

Don't worry about your house, it's very unlikley you will ever be made to sell it. The only time this can occur is if a judge sees it being as the only way in which you can repay your debts in reasonable amount of time, once a charging order is obtained after a CCJ. If you are on a DMP you are showing willing to repay the debt, so the chances of this happening are extremely unlikely (I've never spoke to a client personally where this has happened).

Hope this helps,
Matthew

CCCS_Matthew

stickman wrote: »

Currently on DMP with cccs who are by the way brilliant. Currently paying 407 on debts of 48k which roughly will take just over 9 years to pay off. I retire before then and would like nothing more than to clear all off as fast as possible. The problem is like so many others the creditors are reluctant to stop the interest. Just say that I could afford extra on the monthly payment its pretty pointless as its just going in interest not reducing the debt.
I know its my own fault I realise this but surely it would be better for all concerned to pay off sooner than later ie the total ammount owed 48k and freeze the interest.
Also could anyone tell me how can you come to a Full and Final settlement as I have heard that if you offer 60p in the pound then its possible the creditors would accept this rather than prolonged payment lasting years.

All advice/help appreciated.

Thanks

Hi there, thanks for the post.

A full and final settlement is where you can approach a creditor and offer a lump sum in one go to clear the debt. For example, if you had £10k you could consider offering it in one sum to a credit debt to the value of £15k perhaps, and they may consider accepting it. Potentially doing this with multiple debts you can save a lot of money.

However, it's only possible if you have that kind of money available. Most people making settlement offers have a lump sum from a sale of a house, or recieved a lump sum from a family member or an insurance payout perhaps. If either of these apply to you, we could certainly discuss this with you in more detail if it's something you want to look at doing, and provide you with template letters to approach your creditors with.

Regards,
Matthew.

CCCS_Matthew

my_responsibility wrote: »

Hello,

Firstly can I just thank you for your website. I had contemplated entering into an IVA until I completed the debt remedy on your website and am now awaiting the pack for a Debt Managment Plan. I have a couple of questions with regard to the Plan. I am currently on benefits, I have been awared these benefits until 2010, if in 2010 I loose my entitlement to these benefits what will happen with the plan, as on the website it stated that it will take to beyond 2010 to clear my debts? Will my payments be reassessed? Also, when hopefully my creditors agree to it, what way will my credit refernce file be affected?

Hello there.

We will assess the plan as standard every 12 months to see if the payment is affordable, as some living costs may alter as well as your income. If you find in 2010 your entitlement is lost, we will reassess the situation to see whether the DMP is still a possibility with a lower amount, or look at other more suitable options if the DMP was no longer viable.

Your credit file will be affected if the creditors start to issue defaults against you (they may do this even if the accept payments on the DMP). A default notice would stay on your file for 6 years. If they don’t agree to the plan, it could result in a CCJ which would also stay on file for 6 years from the date of issue.

Hope this helps,
Matthew.

lulaloo

Hi,

To cut a long story short, I went over my over draft limit by about £500 because of bank charges.
Obviously, I need to pay this back. Over a series of letters with Lloyds I have offered them a payment plan of £20 per month (which is all I can afford).
I recieved no response from lloyds and continued to deposit £20 per month into the account (for the past 2 months).

I recieved a letter from solicitors this morning saying that they were acting on behalf of Lloyds and needed this £460 to be paid into the account within 10 days. I know that Lloyds are just trying to get back what is owed to them, but why do they expect that I will miraculously have the money to pay when a solicitor asks instead of them?

What should I do? I'm thinking of writing to the solicitors to explain that I have offered a payment plan - will they accept this or will they take me to court. Whichever way this happens, and whoever I end up owing the money to, the fact still remains that I can only afford to pay £20 per month.

CCCS_Matthew

lulaloo wrote: »

Hi,

To cut a long story short, I went over my over draft limit by about £500 because of bank charges.
Obviously, I need to pay this back. Over a series of letters with Lloyds I have offered them a payment plan of £20 per month (which is all I can afford).
I recieved no response from lloyds and continued to deposit £20 per month into the account (for the past 2 months).

I recieved a letter from solicitors this morning saying that they were acting on behalf of Lloyds and needed this £460 to be paid into the account within 10 days. I know that Lloyds are just trying to get back what is owed to them, but why do they expect that I will miraculously have the money to pay when a solicitor asks instead of them?

What should I do? I'm thinking of writing to the solicitors to explain that I have offered a payment plan - will they accept this or will they take me to court. Whichever way this happens, and whoever I end up owing the money to, the fact still remains that I can only afford to pay £20 per month.

Hi there.

Often creditors do not want to accept reduced repayment plans, so if you are not in the position to entertain the amount they request then they will normally pass it on to a DCA or a solicitor. This doesn't change they way you need to go about the situation, other than direct your payments towards the solicitor rather than Lloyds if they've actually sold the debt to them.

If the solicitors aren't happy, they may continue to ask you for the full amount or larger repayments. If you stick to your guns of £20 a month and keep paying it, their only other option is to opt for a CCJ to illustrate through the court what your financial situation is. If show that £20 is all you can afford, and assuming your other living costs are reasonable your offer will be accepted and then Lloyds and/or the solicitor cannot request any further money as it's been set through court.

Hope that helps!
CCCS

longforthesun

OH and I have a DMP running with CCCS. I have now returned to full time work and as such we have a lot more available income to give to our creditors. With the increase we would be able go back to our original payment with all our creditors. Would we be better leaving CCCS and just paying our creditors ourselves. Also how would this work if the original creditor has sold the debt on.

Many thanks.

debtuptomynads

My head is in a whirl. Can anyone clarify my main questions which are these:

At this moment I have not missed any payments on any of my debts.

Should I contact the Credit Cards via the number on the statement as it suggests and tell them I'm in trouble and cannot make the payments, (which are covering the interest only.)

What is the likely outcome? Has any CC ever responded by freezing the interest, and generally tried to be helpful. Or am I in for a world of abuse and threat by bringing my problem to their notice?

Secondly. If I entered into a DMP for my credit card debts (one is with HBOS), what is the chances of getting a new morgage deal in 2 years when my current one ends (I'm morgaged with HBOS) I have never missed a payment, and don't intend to.

My OH is worried that they'll refuse to offer us a morgage (or anyone else for that matter) and we'll have to sell the house because they'll demand the 50,000 we owe on it.

My OH has point blank refused to remorgage (I'm not sure if we could even at this stage ie: no missed payments on anything ... yet.) Would it ever be a feasable option?

Ultimatem: The OH is just about talking to me but if the house goes, so does she.

rachaelfleur

I spoke to a CCCS advisor online today about my current situation and got a debt remedy booklet. I'm now going through it before deciding to go with a DMP or not. Before I make that decision I have a few questions I need cleared up. I've tried going online again but it's currently not available so thought I would ask here. I have a few questions so I'll list them below:
1. Will I still be in control of my HP or will I have to give up my car?
2. I've included in my debt remedy a loan with HFC for a sofa, the outstanding balance is £503 and I only have 2 and a bit payments left, the only trouble is it's actually in my sisters name as I couldn't get credit for it and the direct debit was set up from my account instead, can this be excluded from the DMP?
3. I have an overdraft on my current account of £342 and have an agreement with LLoyds TSB to reduce this by £50 every month, should I keep this in the DMP? I'm worried they close my account if I choose the DMP.
4. If I were to accept the DMP say tomorrow, do I cancel all my direct debits to creditors immediately as they're due to come out my account on the 25th? I think the advisor told me to do this and use the money to pay my rent and council tax arrears but I was in such a fluster at the time I'm not 100% sure.

Thanks in advance for any help and advice given.