Debt Management!!!!

Laura1985Tyssen

Good or Bad Idea?

Im new to the site btw.

I've been talking to a company and they seem really pushy in wanting me to sign up which just makes me wary.

What are the Disadvantages to it?? Has it worked for anyone on here?

~Beanie~

If the company that you have been talking to are one that charge a fee for their services - and if they are being pushy then it sounds like they are - don't touch them with a bargepole.

There are charities that can set you up on a DMP (debt management plan) if that is what is best for you and they won't charge a penny, all your monthly payments will be going towards reducing your debts.

Have a look at these...

http://www.cccs.co.uk/
http://www.payplan.com/

Tixy

Hi Laura

Do you mean a commercial company to do a debt management plan? if so Bad idea.

Get some free advice from a charity organisation or a non-fee charging organisation such as CCCS or Payplan. They may tell you a DMP is the right option but won't charge you fees. They will also talk you through the downsides such as damaging your credit rating before you make a decision.

Anyone who is being pushy is someone to be wary of if you ask me.

DMPs work for hundreds of people on here, but only if all your money is going to pay off your debts, not lining the pockets of the DMP organisation.

Laura1985Tyssen

Thanks guys - yes they would have been taking a fee 10 or 15% I think he said.

He was adiment he didnt want me to go away and think about it. I said I would like to look into it more etc

Tixy

He probably thought you might find you can get the same (or better) service for free elsewhere!

If you are having difficulties making your debt repayments I'd suggest you complete a financial statement of affairs - SOA (if you haven't done so yet) this will set out in black & white what position you are in and where your money is going. It will be useful to have to hand if/when you speak to CCCS or Payplan.

Additionally you could post it on here and we will look and see if we can advise areas you can save money or where you can maybe cut back and which order to tackle your debts in. Between us all we nearly always come up with something useful.

Once you have done this you can seek professional advice and decide how best to tackle your problems.

Here is the link to the SOA calculator.

Laura1985Tyssen

Thanks Tixy - well below are my debts as they currently stand. Some are approximates though.

£8000 - Freemans Catologue
£2000 - Barclaycard Loan
£1000 - Barclaycard Credit Card
£460 - Halifax Credit Card
£300 - Capital One CC
£1250 - Overdraft

I pay minumum payments on all my CC at the moment and 2 have recently gone over their limits because of this.

Im trying to handle it myself as Ive just got a second job but I fear that the CC just keep going over the limits and Im never eating into the actual debt, hence why I thought DM might be a good idea as they try to freeze interest dont they

dancingfairy

That 10 -15 % of your hard earned money could be going to pay off your debt not to line some companies pocket.
Go to one of the charity organisations/ not for profit organisations.
The other places to consider are your local CAB and you can always phone National Debtline.
You really need to fill out a proper SOA folling the link as it makes it clear what your situation is.
The only problem with a dmp is you a) won't be able to get more credit while on it and b) your credit rating will be trashed so if you can make the minimum payments this may be a better option - but again a proper SOA will highlight the way forward.
df

Tixy

They do try and get charges & interest frozen and are often successful (though they can't guarantee it). When you are on a DMP your creditors see an income & expenditure account so they will know you are repaying what you can afford without living a lavish lifestyle. Some creditors are more likley to freeze interest if they are dealing with CCCS or Payplan as they are trusted names in the industry and they know that your money is not going on fees.

The downsides are it will almost certainly affect your credit rating. You agree not to take on anymore credit whilst you are on a DMP (although not necessarily a downside really!), and potentially you could end up with CCJs (though the latter does not happen that frequently).

Good news regarding the second job.

I hope you keep posting for advice and keep reading other people's posts and questions for ideas on how you can money save.

Numpty_Monkey

Listen to Beanie and Tixy and the rest of us NEVER go with a fee charging company no mater what they promise

You don't have to try and handle your debts on your own anymore, The DFW peeps will help as much as they can :A:T for free and there are free debt charities who will help:T

Tixy put a link to the SOA calc (sometimes its hard to spot)
http://www.makesenseofcards.com/soacalc.html
It is very usefull to the clever ones around here to see where you can start making a few savings , and start tackling the debts in the right order if you have any surplus;)
Its not an exam filling it in no right or wrong answers , probably more questions after, but we are nice :A:o