DMP's and the future

notgotenough£

Hi all

I am new this whole thing.

I/we have always been in debt but things I think are starting to get out of hand.

I rang CCCS today and have an appointment to talk them in a couple of weeks,inthe mean time the advice I was given was to stop all direct debits to creditors and set up another abnk account to which we get our salaries paid into and pay out essentials mortgage,council tax etc. This all seems very scarey and I have read on here that this will have future implications when we come to re-mortgage at the end of our fixed rate period,

I have seen paople mention SOA's. I have done one and have pasted it below, is this how it works? Any advice greatly recieved.

I am going to set about reducing things like insurances and cancel my gym mebership.

Things just seem to be getting worse that we are always over our overdraft limit, so much so that we were cahrged 150 quid this month - which just takes us further into our overdraft, and when we getpaid its going o eventually not going to be clearing it.

Any advice greatly appreciated.

thanks for reading
notgotenough£ x

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 650
Partners monthly income after tax....... 1500
Benefits................................ 160
Other income............................ 0
Total monthly income.................... 2310

Monthly Expense Details
Mortgage................................ 829
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 102
Electricity............................. 35
Gas..................................... 25
Oil..................................... 0
Water rates............................. 27
Telephone (land line)................... 45
Mobile phone............................ 45
TV Licence.............................. 10
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400
Clothing................................ 100
Petrol/diesel........................... 40
Road tax................................ 10
Car Insurance........................... 25
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 13
Buildings insurance..................... 24
Contents insurance...................... 20
Life assurance ......................... 20
Other insurance......................... 16
Presents (birthday, christmas etc)...... 15
Haircuts................................ 30
Entertainment........................... 4
Holiday................................. 0
Emergency fund.......................... 15
Total monthly expenses.................. 1870

Assets
Cash.................................... 0
House value (Gross)..................... 155000
Shares and bonds........................ 0
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 156000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 134000...(829)......NaN
Total secured debts........... 134000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
sainsburys bank loan...........11000.....186.......0
cahoot loan....................7000......171.......0
sky credit card................3000......80........0
egg credit card................5.........0.........0
marbles credit card............3000......59........0
halifax credit card............1900......20........0
halifax credit card............700.......15........0
Total unsecured debts..........26605.....531.......-

Monthly Budget Summary
Total monthly income.................... 2,310
Expenses (including secured debts)....... 1,870
Available for debt repayments........... 440
Monthly UNsecured debt repayments....... 531
Surplus(deficit if negative)............ -91

Personal Balance Sheet Summary
Total assets (things you own)........... 156,000
Total Secured debt...................... -134,000
Total Unsecured debt.................... -26,605
Net Assets.............................. -4,605

Created using the SOA calculator at https://www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.

======== Enter any other useful information below ========

e.g. the number of adults & children in the household, the number

of cars included in the SOA or anything else that may be useful.

MyLastFiver

This doesn't look too bad. Your monthly shortfall is not huge. Your creditors will almost certainly accept reduced payments at this level. A note about your budget: £4 per month for entertainment? Be realistic. You don't have to live like a monk because you're on a DMP. Don't worry about not paying your unsecured creditors for a couple of months. Nothing happens - honest. Write to them, tell them you're in fin diffs and setting up a DMP, enclose a goodwill payment of a fiver, and that's it. All that will happen is you get a collections call once a month from each creditor. So you explain again. Fin diffs, DMP, £5 goodwill, blah. They say "OK, thanks" and forward your account on 'til next month. In the meantime, the money you save by not making credit card payments, use it either to make any important capital purchases you need (say if the washing machine's bust or whatever), or keep it under the bed for a rainy day, or go and blow it on an orgy of cocaine and roulette - it's the last substantial lump of spare cash you'll have for a while. If your bank account is with one of your creditors or a partner company, get shut straight away and open one with a bank with which you have no debts. Leave the old overdraft behind - it just becomes another debt to service on your DMP. The Natwest Step account is good as you still get a debit card. Lloyds also have a good basic account but stay away because once they merge with Halifax your money may not be safe, as you owe Halifax. Seriously - the heavens do not cave in because you stop paying your credit cards. All that happens is your credit rating takes a huge hit. But it's going to anyway sooner or later, because you can't afford to keep up your contracted payments. Forget about your sodding credit file. It doesn't matter. Stop spinning plates. Drop everything. Renegotiate on your own terms. It's a great feeling. Honest. I'm six months into a DMP now, and my payments as a proportion of my outstanding debts are far lower than yours will be. I put up with a couple of months of moronic phone calls, but now everything's sweet. No calls, no interest charges, just an affordable payment every month. And a good night's sleep for the first time in years.

notgotenough£

Thanks, I suppose I just feel like its a big step. Would they really take a fiver? I was thinking of knocking them down to about half what we should be paying.

And that £4 a month was for dvd's. Really we don't go out - we have 2 toddlers!

MyLastFiver

No they won't accept a fiver as an ongoing payment through a DMP, but while you're in the process of setting up the DMP, stop making your min payments (you can't afford them anyway) and instead send them goodwill payments of a fiver. Between now and the setting-up of your DMP, give yourself a two-month payment holiday from your creditors. As I say, it's your last chance for many years to get a small lump sum together.

RAS

Hi

How many in your household?

Do you have payment Protection on any of those loans and cards?

You comment on the bank charges. Have you started to reclaim them?

If you have any late charges on the CCs and loans, have you reclaimed those?

notgotenough£

There are 4 in the household 2 adults and 2 kids under the age of 4.

No I don't think we have protection on the loans or cc's.

No started to reclaim as not sure that we could do - its our fault that we went over the agreed limit. Have asked to have the limit increased but heard back today that they won't agree.

The charges on the credit cards are just £12 which I knew we would get.

Any advice greatly recieved

boredofbeingathome

notgotenough£ wrote: »

Hi all

I am new this whole thing.

I/we have always been in debt but things I think are starting to get out of hand.

I rang CCCS today and have an appointment to talk them in a couple of weeks,inthe mean time the advice I was given was to stop all direct debits to creditors and set up another abnk account to which we get our salaries paid into and pay out essentials mortgage,council tax etc. This all seems very scarey and I have read on here that this will have future implications when we come to re-mortgage at the end of our fixed rate period,

I have seen paople mention SOA's. I have done one and have pasted it below, is this how it works? Any advice greatly recieved.

I am going to set about reducing things like insurances and cancel my gym mebership.

Things just seem to be getting worse that we are always over our overdraft limit, so much so that we were cahrged 150 quid this month - which just takes us further into our overdraft, and when we getpaid its going o eventually not going to be clearing it.

Any advice greatly appreciated.

thanks for reading
notgotenough£ x

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 650
Partners monthly income after tax....... 1500
Benefits................................ 160
Other income............................ 0
Total monthly income.................... 2310

Monthly Expense Details
Mortgage................................ 829Is this interest only? You can convert to that for a year or so if that helps
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 102ask to put over 12 months
Electricity............................. 35These are good, but you could still check around for better rates and get cashback through signing up at quidco
Gas..................................... 25
Oil..................................... 0
Water rates............................. 27
Telephone (land line)................... 45change this to another provider all doing good deals, talktalk is doing half price for first six months, we are on the 19.99 all inclusive talk and broadband package
Mobile phone............................ 45this can be reduced if you are on a contract have a look at martin's guide to reducing contracts, if not Tesco doa new payg rate which is very cheap
TV Licence.............................. 10
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400you can easily reduce this..go over to Oldstyle baoard and join in grocery challenge with us all:rotfl:
Clothing................................ 100again easily reduce this, primark, charity shops asda..all dirt cheap good quality
Petrol/diesel........................... 40
Road tax................................ 10
Car Insurance........................... 25when renewal is up look for cashback offers at quidco and follow martin's advice on reducing car insurance
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0you need to have something for this
Pet insurance/vet bills................. 13again check through advice on this and the old mantra quidco
Buildings insurance..................... 24as above
Contents insurance...................... 20as above
Life assurance ......................... 20
Other insurance......................... 16as above
Presents (birthday, christmas etc)...... 15
Haircuts................................ 30reduce this by having someone come to house or look for college days, cut children's yourself
Entertainment........................... 4
Holiday................................. 0
Emergency fund.......................... 15
Total monthly expenses.................. 1870

Assets
Cash.................................... 0
House value (Gross)..................... 155000
Shares and bonds........................ 0
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 156000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 134000...(829)......NaN
Total secured debts........... 134000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
sainsburys bank loan...........11000.....186.......0
cahoot loan....................7000......171.......0
sky credit card................3000......80........0
egg credit card................5.........0.........0
marbles credit card............3000......59........0
halifax credit card............1900......20........0
halifax credit card............700.......15........0
Total unsecured debts..........26605.....531.......-

Monthly Budget Summary
Total monthly income.................... 2,310
Expenses (including secured debts)....... 1,870
Available for debt repayments........... 440
Monthly UNsecured debt repayments....... 531
Surplus(deficit if negative)............ -91

Personal Balance Sheet Summary
Total assets (things you own)........... 156,000
Total Secured debt...................... -134,000
Total Unsecured debt.................... -26,605
Net Assets.............................. -4,605

Created using the SOA calculator at https://www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.

======== Enter any other useful information below ========

e.g. the number of adults & children in the household, the number

of cars included in the SOA or anything else that may be useful.

Hi welcome to the board,:hello: i have included a few comments for you to try and see if you can reduce expenditure, and make it all a bit more liveable for you. You may also want to keep a spending diary, which will help see where your money goes. I think with careful budgetting you may be able to avoid a DMP but if you think that is the way to go it is entirely upto you. Either way it is going to be a struggle for a few years. Other things you may want to look at is ways to increase your income.
I think it is a good idea to open another bank account as well, just to get rid of charges on overdraft. Have you also had a look at creditcard shuffle on the website, might find with a little rearranging that you can free up more income.
Also claim back everything you can, it is no time to get frightened about it as it is perfectly legal and really nithing to worry about..also look to see if you have been mis sold any PPI as well.
Good luck with it all and i hope you keep posting with your progress.
BOB X

RAS

notgotenough£ wrote: »

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 650
Partners monthly income after tax....... 1500
Benefits................................ 160
Other income............................ 0
Total monthly income.................... 2310

Monthly Expense Details
Mortgage................................ 829 - repayment or interest only?
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 102 - can you pay this over 12 months?
Electricity............................. 35
Gas..................................... 25
Oil..................................... 0
Water rates............................. 27
Telephone (land line)................... 45 - this is high. Get OH and any of the kids who are techie to read the telephone board on here and learn to get free calls. You need to get it down to £15
Mobile phone............................ 45 - reduce you package and then go PAYG
TV Licence.............................. 10
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400 - you can halve this if you go on the Money Saving Old Style forum
Clothing................................ 100 - you just cannot afford this amount of clothing. Buy knickers, a couple of pairs of shoes each and then go www.freecycle.org for other stuff.
Petrol/diesel........................... 40 - if this is all you use, do you need a car?
Road tax................................ 10
Car Insurance........................... 25
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 13
Buildings insurance..................... 24 - you may well be able to shave a bit off this use a comparison site and then switch via www.quidco.com or another cashback site
Contents insurance...................... 20 - ditto
Life assurance ......................... 20
Other insurance......................... 16 - what is this?
Presents (birthday, christmas etc)...... 15
Haircuts................................ 30 - you need to reduce this. College nights?
Entertainment........................... 4
Holiday................................. 0
Emergency fund.......................... 15
Total monthly expenses.................. 1870

Assets
Cash.................................... 0
House value (Gross)..................... 155000
Shares and bonds........................ 0
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 156000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 134000...(829)......NaN
Total secured debts........... 134000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
sainsburys bank loan...........11000.....186.......0
cahoot loan....................7000......171.......0
sky credit card................3000......80........0
egg credit card................5.........0.........0
marbles credit card............3000......59........0
halifax credit card............1900......20........0
halifax credit card............700.......15........0
Total unsecured debts..........26605.....531.......-

Monthly Budget Summary
Total monthly income.................... 2,310
Expenses (including secured debts)....... 1,870
Available for debt repayments........... 440
Monthly UNsecured debt repayments....... 531
Surplus(deficit if negative)............ -91

Personal Balance Sheet Summary
Total assets (things you own)........... 156,000
Total Secured debt...................... -134,000
Total Unsecured debt.................... -26,605
Net Assets.............................. -4,605

2 adults & 2children in the household,

Hi

You have not listed the amount of your overdraft? How much is it, how much are you allowed? Add that to te list below.

notgotenough£ wrote: »

What are the APRs on thses loans and cards? This is IMPORTANT as you you need to know which ones to pay off, whether you can get a balance transfer to a lower rate.

What are the limits on the cards? and how many more months on earch of the loans?

Unsecured Debts
Description....................Debt......Monthly...APR
sainsburys bank loan...........11000.....186.......0
cahoot loan....................7000......171.......0
sky credit card................3000......80........0
egg credit card................5.........0.........0
marbles credit card............3000......59........0
halifax credit card............1900......20........0
halifax credit card............700.......15........0
Total unsecured debts..........26605.....531.......-

You may well benefit from getting an Alliance and Leicester bank account with free OD if they still accept people, as this would give you some breathing space.

You should reclaim the bank charges, as £150 per month is outrageous. You may not get it all back but it would make a difference.

You do not really need to wreck your credit rating by doing a DMP, with a bit of budgetting you could get this back in track over the next 3 months.

if you have anything useful kicking around the house that has not been used in a while consider selling on amazon, e-bay or at a car boot sale. that would kick start the turn round.