What should i do about my DMP?

babyplum

Hi everyone.

Just looking for some advice really.

Me and my husband have been in a DMP for over 3 years and have managed to reduce our debts from £20k to £13k.

We used to pay off £500 per month and things seemed to be going just fine but then i had a baby only recieved the basic maternity allowance whilst on maternity leave. Now i am back at work but am only working part-time and we have had to reduce our payments to £150 per month.

But we are just not coping at the moment and every month i am having to try and sell things or borow money just to pay our bills and buy food.

I am currently looking for a full-time job in the hope of bringing in some extra money but by the time i have paid for the childcare for my son it wont really leave us with much more money.

I am getting very depressed about the situation and dont know what else to do. Should i consider and IVA or Bankruptsy??? We initially dismissed these options are we are still renting and want to be able to get our own mortgage at some stage.

Also i am having major problems with Natwest and have from the very beginnning. I had 2 overdrafts and a credit card with them and these are the only debts which are still charging me huge amounts of interest. The amounts of these debts are higher now than wehn we first started. It makes me so mad!

For example - my natwest credit card started at £2788.04 and is now at £2845.68 despite me paying them £1438.65!!!
I know i shouldnt have got into the debt in the first place but this is just crazy. We have been trying so hard to get ourselves out of debt over the past few years and this is just money down the drain.

Sorry for the ramble! Any advice?

babyplum

Ok, so i have just read Martins guide to IVAs and Bankruptsy and realise that these are not options for us now.

I can't see any other option now though, even if i get a full time job by the time i have paid for childcare it would probably only leave us with a extra £100 per month and the way things are going at the moment we will need that to live not to pay off our debts.

I have a very finely tuned budget for food every month. We get mobile phones free from my husbands work and everything else is the normal bills.

We are considering moving closer to my husbands work so our petrol costs and bus fares are lower.

Another option at the moment is to move in with my parents for a year to try and get ourselves together a bit. Really dont want to do this after living together for 7 years and now have a 1 year old! But maybe i need to do it even if it will be a nightmare for everyone.

Nargleblast

You could try posting a statement of affairs on here (use the calculator sticky at the top of the forum) for people to advise you on saving money. You may have to go back to the company you do the DMP with and agree with them a revised budget. If any unforeseen expenses occur (car problems, washing machine knackered etc) then they may reduce your payment to help with that. Also a look at the Old style moneysaving forum could give you ideas on how to manage on a limited income. Just a few things to be going on with.

Tixy

Hi Babyplum well done for the amounts you have paid off so far.

Agree with NargleB that a statement of affairs may help you and may help us advise if and where anything can be changed - http://www.makesenseofcards.com/soacalc.html

Also have you checked you are getting the benefits you are entitled to? do a quick check on www.entitledto.com

What company are you using for your DMP? Is it a fee charging commercial company or one of the free/charity organisations? If you are paying a fee for your DMP you can increase the amount creditors receive by using a free DMP organisation so no fee is paid.

With regards to Natwest not sure what advice to offer, 3years is along time for them to keep a debt and keep chargin interest. If you are on low DMP payments creditors usually sell on to a DCA long before this time scale. I assume you have sent numerous letters asking them to stop interest? (National debtline website has some good templates) If you haven't sent any such letters in the last few months then maybe you could try again? If not you may have to hope that they sell on to a DCA (who often don't charge interest), maybe the reduction in your monthly payments will be a catalyst for this.
Another possibility which sometimes encourages a provider to accept reduced payments is to request a copy of the consumer credit agreement to check its legally enforceable, should it not be you may find that you have more bargaining power with them.

GeorgeUK

Can i ask who you are in a DMP with? Is it one of the free debt charities such as CCCS or Payplan? Or is it a company that is charging you a fee?

I would get in touch with CCCS and try to get a DMP set up with them if you are with a fee paying one. They will also make sure that you have enough to live off and are not having to sell things just to get by.

It might also be worth looking to see if the credit agreements are enforcable.
Also look into reclaiming any charges you have had in the past 6 years and see if you have been missold Payment Protection Insurance.

Paulgonnabedebtfree

babyplum wrote: »

Hi everyone.

Just looking for some advice really.

Me and my husband have been in a DMP for over 3 years and have managed to reduce our debts from £20k to £13k.

We used to pay off £500 per month and things seemed to be going just fine but then i had a baby only recieved the basic maternity allowance whilst on maternity leave. Now i am back at work but am only working part-time and we have had to reduce our payments to £150 per month.

But we are just not coping at the moment and every month i am having to try and sell things or borow money just to pay our bills and buy food.

I am currently looking for a full-time job in the hope of bringing in some extra money but by the time i have paid for the childcare for my son it wont really leave us with much more money.

I am getting very depressed about the situation and dont know what else to do. Should i consider and IVA or Bankruptsy??? We initially dismissed these options are we are still renting and want to be able to get our own mortgage at some stage.

Also i am having major problems with Natwest and have from the very beginnning. I had 2 overdrafts and a credit card with them and these are the only debts which are still charging me huge amounts of interest. The amounts of these debts are higher now than wehn we first started. It makes me so mad!

For example - my natwest credit card started at £2788.04 and is now at £2845.68 despite me paying them £1438.65!!!
I know i shouldnt have got into the debt in the first place but this is just crazy. We have been trying so hard to get ourselves out of debt over the past few years and this is just money down the drain.

Sorry for the ramble! Any advice?

As your debts are now below £15,000, might a Debt Relief Order be appropriate?