Is interest guaranteed to be frozen on a dmp?

rainbowseeker

Hi everyone,
I've been getting quite stressed out trying to sort out a d-i-y DMP with advice from the nationaldebtline website, and am wondering whether to concede defeat and go with payplan or cccs and work out a formal DMP. Thing is I'm quite a stubborn person and have been reading encouraging reports from other D-i-y-ers.
At the moment, I have managed a reduced payment plan for 12 months with interest frozen from Marks & Spencer who I have to say have been very sympathetic and helpful.
Unfortunately not the case with MBNA with whom I have 4 credit cards (Virgin, Alliance + Leicester and Abbey Visa, Mbna). They refused to help at all when I called them, just to echo what other people here have experienced when dealing with Mbna, they would not accept reduced payment or freeze interest (although as per advice from national debtline, I will send what I can afford in the meantime anyway to show I am doing my best to pay them).
Still waiting to hear from other creditors, but at least they seem genuinely open to considering my offers.

So my question to people on a formal DMP arranged by either payplan or cccs is this:
Did they manage to negotiate interest to be frozen on all your accounts for you?

Any opinions or advice on which way I should go would be greatly appreciated.
Btw, my total debts amount to just over £75K

bumblebee_3

As far as I am aware CCCS and Payplan negotiate with your creditors to freeze interest, reduce payments etc and you pay payplan who pay your creditors on your behalf.

You seem to be doing really well negotiating with your creditors it is a shame that MBNA are not being more sympathetic to your suggestions.

As someone who is planning on using payplan I would contact them for extra support on this, it is your personal choice tho, and get support from these boards as well.

Best of luck

pixie1

Im going via cccs but its in the very early stages. They do ask for interest to be frozen but it up to the creditor. There is something in the banking code though about the creditors helping people in debt and not forcing them into more, this is something the national debt line told me about - sorry i cant remember the exact wording.
I too have a card with MBNA...its worrying to hear that they are not that helpful.

Give the nat debt helpline a call - what have you got to loose.

rainbowseeker

Hi bumblebee, pixie1,
yes, on formal dmp's set up by the likes of payplan and cccs, that's what they say - they negotiate to freeze interest for you, that's why I was interested to see if anyone already set up on one had managed to get all their accounts' interest frozen.

There is something in the banking code though about the creditors helping people in debt and not forcing them into more, this is something the national debt line told me about - sorry i cant remember the exact wording.

I've read that somewhere too, but obviously to some creditors the line about 'helping' is open to their own interpretation. The guy at Mbna asked if I had any equity in my house to which I replied I am not a homeowner. He then 'helped' me by advising 'could you perhaps get a consolidation loan?' - been there, done that.

But thanks for the input.

pixie1

There is someone on this board that managed to freeze interest on their debts by doing it themselves, i cant cant remember their name. Its in their signature. Maybe they will see your post Im not sure if MBNA was listed though.

Sorry i cant help anymore.

AGB863

It is entirely up to the creditor to suspend the interest on any account that may be in arrears.

When I negiotiate with the primary lender for my clients and an offer of repayment is made and accepted, but they are not prepared to freeze the interest charges, we usually take the stance that it is in my clients interest not to make any further payments towards the debt (especially if it is low offer of repayment and the interest being charged is nearly the same as the payment).

This normally forces the creditor either to suspend the interest or to send the debt to another collector.

pixie1

AGB863 wrote:

This normally forces the creditor either to suspend the interest or to send the debt to another collector.

Do lenders normally send the debt to other collectors rather then proceed with court action?

emilykat

We have debts that were in the region of £30,000 with 9 different creditors, and we have been with Payplan for just over 12 months.

All of our creditors with the exception of Natwest (who have been quite difficult) have frozen interest on our accounts and one of our creditors who we had a credit card with, have rewritten our debt into a kind of interest free loan and have knocked a few thousand pounds of in the process. :T

So yes, we have found being in a debt management a big help. The only thing we seem to hear from the creditors, is that they usually request an update on your statement of affairs usually six monthly.

Good luck.

idiot_3

pixie1 wrote:

Do lenders normally send the debt to other collectors rather then proceed with court action?

yes and no. to sound harsh (but this is how it is looked at) if you are not worth sueing, you will not generally be sued. the reason is that the court will often enforce you paying much less than the creditor is asking for, so it is more economically sound for them to sell it on for x pence in the pound, than it is to persue it themselves. and with large financial institutions customer service and satisfaction is paramount. in order to preserve a good image, they will often accept a loss in order to preserve this.

AGB863

pixie1 wrote:

Do lenders normally send the debt to other collectors rather then proceed with court action?

The lenders normally send it out to collectors as they prefer to write off the debt and get something back from selling the debt. This is normal where the debt is not secured ie credit card / store card etc

klare_2

ive been with the cccs for over 6 months now and lloyds tsb have been absolute b######s ... sorry Lloyds but you have. Everyone else has frozen interest, they did for about 4 months and then turned around whacked on interest and wiped out all the payments we had made via the cccs. they are the most unhelpful people i have ever come across and will do what ever they can to squeeze those last few drops of blood out of you if they can. they also dont follow their own 'we will help you' statement, if they so chose not to ....
somebody give me a gun....


.............and breeeeeeeaaaaaaaaaatttttttthhhhhhhhhhhheeeeeeeee........

PS. apart from the the DMP has helped a lot and the CCCS all deserve knighthoods!!