DMP vs Full & Final settlement and advice on SOA

fermi

OK merged these two threads.

I've not been following this closely, so if the new tilte does not fit then let me know and I will amend.

Burlesque_Babe

something else - you mention bailiffs.

Bailiffs can ONLY be used when a CCJ is in place.

Debt collection companies will threaten all sorts of tosh and anyone they send around is NOT a bailiff, just a bully boy who you can tell to well and truly do one. If they ever send anyone around wanting to make an arrangement or collect money at the door - again - they have no power to do this and you can tell them to go away - as politely or rudely as you choose.

Never do any negotiation by phone or make any arrangements on the phone. Do it all in writing.

Nargleblast

Whatever you do, it will be painful to start with. If you go through CCCS and set up a debt management plan then you will have a source of professional advice and support whenever you need it. You could try going it alone and negotiate with all your creditors but unless you are really, really clued up financially it would be difficult. And, let's face it, if you were clued up financially you would not be in this mess, would you? This comes from someone who has been up to her eyeballs in financial problems for ages but only started getting a grip on it a few months back. You are not alone. Follow Burlesque Babe's suggestions.

icecube2009

Burlesque_Babe wrote: »

You have to do what is best for you..

See at the moment I feel paying off a small amount each month over a longer period is the best option whilst I have the children (11 & 13) because I find it very difficult to make my children scrimp too, although they have to make do with cheapie trainers and only get to have the computer games etc they want if they buy them themselves. My sons class is going on a school trip in the summer £150 for 4 days, but how can I tell him he cant go, he would be the only one in the class, even the ones who get free school dinners can go (and they have the latest trainers too!), I can let him be singled out. If it were just me & DH I would happily live on bread & water & pay every penny I had off clearing the debt, and maybe in 5 years time be debt free, but in 5 years time it wouldnt matter so much as my kids would probably have jobs of their own, its it now that I need to be able to afford things for them, why make them suffer becuase we are loosers? (I have tears streaming down my face), it isnt their fault

icecube2009

RAS wrote: »

Hi

If you are both in very basic clothing etc, WHAT have you spent £35K buying?

My DH use to go to the pub at lunch times in his old job, he ran up a lot like that, He use to smoke 20 a day, more money, he is a bit of a gadget freak, liked to have latest computers games consoles, decent stereo system, had to keep up with much higher earning mates etc. I have only used a credit card when I have needed to because I havent had enough money left to buy groceries or clothes for the children, it has all mounted up over quite some time, and until recently I thought it was only £32k (bad enough) until DH let on that he had a card I didnt know about

And you need to check out the possibility of second hand uniform. I am sure the school has a scheme? have checked, there isnt

With respect to SOAs, there are different sorts. A DMP or BR assumes that you need decent allowances because you can get no more credit and have to hav e spare for emergencies. yes this is what the CCCS
one does allows extra, just in case, so could be i could put some asside for emergencys and if no emergency then pay off a lump sum, but if It didnt allow anything and then emergency happened I would be stuck
The stark reality is that a high percentage of the population live on far less than the allowances and DFW SOAs are about living off what you have rather than what you would like to have.

With respect to the car - you are spending at least 63 per week on transport. How much would regular travel passes cost you? In my area £100 per month buys county wide bus and train transport. would cost us £10 each for a bus pass, busses are hourly, if the children miss them they are an hour late for school, or sometimes they just dont even turn up. I dont even have a bus that goes to my work place.so yes we would save £23 a week, but with no car for emergencies etc it would be very difficult

Do you have equity in the house because it is more likely these days that companies will go to secure the debt via charging orders than accepting a F&F, if you have any equity.what does this mean????

thanks.......

Burlesque_Babe

icecube2009 wrote: »

See at the moment I feel paying off a small amount each month over a longer period is the best option whilst I have the children (11 & 13) because I find it very difficult to make my children scrimp too, although they have to make do with cheapie trainers and only get to have the computer games etc they want if they buy them themselves. My sons class is going on a school trip in the summer £150 for 4 days, but how can I tell him he cant go, he would be the only one in the class, even the ones who get free school dinners can go (and they have the latest trainers too!), I can let him be singled out. If it were just me & DH I would happily live on bread & water & pay every penny I had off clearing the debt, and maybe in 5 years time be debt free, but in 5 years time it wouldnt matter so much as my kids would probably have jobs of their own, its it now that I need to be able to afford things for them, why make them suffer becuase we are loosers? (I have tears streaming down my face), it isnt their fault

hi - please don't cry, I know it's really hard

You are doing the right thing - cheap trainers are fine :T The kids who are on free meals but have dear trainers - think of the mess their parents are probably in and are more than likely to get in even more of a mess. Kids don't really realise they are scrimping. buying their own games is not scrimping - it's teaching them the value of the amount of money in their pocket.

What is the deadline for the trip? How about a concerted ebay effort until then? I reckon £150 is very do-able within a month. How about some of your hubby's discarded gadgets i've seen some DFW peeps who have something urgent to save for, start a thread specifically for it, everyone gets behind them and they succeed.

Have a hug from me and know you are amongst people who have been exactly where you are.
I know I might be sounding a bit 'you must do this' but having had a really knackered credit file myself, I would really push to anyone to avoid this like the plague as much as possible and to look at other options. I had no option but to stick with my vile 34% CC's because that's the mess I had got myself in - with a decent credit file, you're a step ahead of where I was in terms of getting 0% cards at some point in the future to transfer some of the debt onto and clearing it even quicker.

With regards to a DMP taking 17 years - you never know how life can change. I wanted to be debt free by 40 (next year) and never dreamed I'd get the back pay, life can change and with concerted hard work you can really chip away at a debt free date.

icecube2009

Burlesque_Babe wrote: »

hi - please don't cry, I know it's really hard

You are doing the right thing - cheap trainers are fine :T The kids who are on free meals but have dear trainers - think of the mess their parents are probably in and are more than likely to get in even more of a mess. Kids don't really realise they are scrimping. buying their own games is not scrimping - it's teaching them the value of the amount of money in their pocket. my son is fine he doesnt complain, my daughter is a little more demanding & constantly goes on about us being poor, which hurts! she does understand the value of money though, tried to get a local paper round (free paper only need to be 13) but no vacancy at the moment

What is the deadline for the trip? How about a concerted ebay effort until then? I reckon £150 is very do-able within a month. How about some of your hubby's discarded gadgets i've seen some DFW peeps who have something urgent to save for, start a thread specifically for it, everyone gets behind them and they succeed. I owe £90 on the trip, and have to pay by beginning of april, yes I can probably make that on ebay, will have to put in more of an effort!!

Have a hug from me and know you are amongst people who have been exactly where you are.
I know I might be sounding a bit 'you must do this' but having had a really knackered credit file myself, I would really push to anyone to avoid this aviod what? debt management plans ? like the plague as much as possible and to look at other options. I had no option but to stick with my vile 34% CC's because that's the mess I had got myself in - with a decent credit file, you're a step ahead of where I was in terms of getting 0% cards at some point in the future to transfer some of the debt onto and clearing it even quicker.

With regards to a DMP taking 17 years - you never know how life can change. I wanted to be debt free by 40 (next year) and never dreamed I'd get the back pay, life can change and with concerted hard work you can really chip away at a debt free date. but it also worry it could change for the worse, what if one of us lost our job? I am a real worrier, its dreadful!!

I am 42, so no chance of being debt free by the time I am 40!! 50 would be nice though!!!

icecube2009

loaner wrote: »

The best thing to do for your kids is to explain that they can only have things that are affordable, that lesson will hopefully stay with them for life, and be far more useful than a school trip and expensive trainers. Teach them to budget early.

Maybe he could do odd jobs, car washing etc to help pay for it.

If you add it all up, the car (insurance/tax/repairs/fuel/parking/purchase/interest) is a significant expense, so the first thing to look at. Then put a line through all the non-essentials.

You also spend a significant amount on insurance, which at present isn't affordable.

Could you add the apr's to your soa, and the length of the loans

You could offer to pay the parents an interest rate higher than they are getting in the bank, and use the money to pay off high apr debts, that way you both win

I agree the car is a biggy, would save a heck of a lot without it, but cant manage without it, and DH wont manage without it. I know stupid....he is very stupid, we are in this mess because of him, so he thinks he is doing the best trying to sort it out by speaking to his parents....Update on that, Mum thought he was going to say we had split up so was relieved to hear we arent, but then burst into tears (she does that a lot) when money was mentioned, he handed them the 'essay' he wrote them & told them he would wait in the car until they had read it & if he doesnt hear from them in a hour he will go home (they are strange really dificult to talk to and will have no sympathy whatsoever, never been in debt never had a credit card, think debt is a sin!!) that was about half hour ago, he is still sitting in the car!

Burlesque_Babe

sounds like your daughter is being a typical teenager

The worry about job loss is never going to go away, whatever your situation, so the best thing to do is get yourself in the best possible position, should it happen. Whilst in debt, my income was around £1600 per month and just as I became debt free it went up to £1800 per month which would have been the beginning of a new start. I then lost my job (long story) and am now working part time, I have 4 jobs which between them struggle to bring in £1000 per month after tax. It's really hard for me financially - but imagine if I'd have paid lower amounts over a longer time, well, to be honest, I don't want to think about it I am hugely grateful to MSE though as everything I learnt on my journey has become the basis of my finances, budgeting, spending and general attitude to money. I'm no angel, trust me, but I now think about everything I buy whereas in the past I spent huge amounts on clothing, at the pub, Tesco Finest, holidays in really posh self catering cottages etc etc etc, never had anything to show for it and just stuck my head in the sand.

The 'avoid it' bit is any plan you may have which means ending up with defaults etc, you are in a situation where you are meeting your commitments, to let them slide for the sake of it feeling a bit easier would be a real shame, especially as you have so much you can save each month in your SOA.

why not aim for 50? Set yourself the goal now and start changing things bit by bit.

£90?? Go for it......I reckon you'll fly through it - set it as your first personal challenge - add it to your signature to really focus your mind.

icecube2009

loaner wrote: »

As it stands, you have £394/month to pay for everything after the mortgage/debt repayments, so to do this, you will have to prioritise, and make some sacrifices, and as soon as the debt comes down, things will be easier.

£394? where do you get this figure? do what? a DMP and pay off £394 ? sorry not quite following!!