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Considering setting up my own DMP.

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Hi,

Anyone who has done this, is it more difficult than going through payplan or cccs?

How would this affect my credit report. Would making smaller payments than the current minimum amounts show as arrears in the line of 0s + 1s? Or does it depend on the the individual creditor?

TIA.
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Comments

  • ms_london
    ms_london Posts: 2,852 Forumite
    Part of the Furniture 1,000 Posts Photogenic Name Dropper
    I suppose I did this myself, as I got out of debt without using CCCS/Payplan. Basically I worked out what I could afford and put my proposals to my creditors, most of whom accepted. I dont think it had any adverse affect on my credit file, by that time it was shot to pieces anyway with numerous defaults/non payments.

    I didnt really know what was available to help at the time, but would probably manage it the same way again as I like feeling under control!!

    Have you got a SOA already?

    xx
  • all_hours
    all_hours Posts: 684 Forumite
    Thanks ms_london.

    I posted my SOA a few weeks ago. But I can't continue this way and need to look at going back to work full time. I'm relying on income that I can't - putting cash on a CC til it comes through - need to make the break at some point.

    I've worked out what tax credit I would get for different salary levels and which outgoings would increase like childcare and travel. The sums don't look good. :( I don't think I'll get the salary I need for the first year or two.

    What happened with the ones who wouldn't accept, did you manage to keep making the minimum payments.

    Will check back later.
  • Broken_hearted
    Broken_hearted Posts: 9,553 Forumite
    The ones that don't accept usualy end up backing down.
    Barclaycard 3800

    Nothing to do but hibernate till spring






  • milliejon
    milliejon Posts: 1,052 Forumite
    I'm currently on arrangements with my creditors by doing my own DMP. I rang the National Debtline and asked them to send me some information. They sent me the whole pack which is also available on line.

    However, when they sent it through they gave me a personal reference number so that if my creditors asked who I was getting information I could say National Debtline and they'd take the reference number for their files.

    The pack (which is completely downloadable from the website), gives template letters for the start to the end. It starts with letters to let creditors know about your situation. Then through to this is what I've worked out I can afford to pay on all my bills and I've pro-rata'd it. They have advice on average amounts for food, clothing etc. It really is helpful - I would never had done my DMP if it weren't for them. It also has an expenditure sheet which does all the calculations for you.

    I'm a control freak and needed to do this for myself, and wouldn't have been happy handing everything over to somebody else to take control of. Sad I know - but true!

    Anyway, I wish you every success with your DMP. Keep us posted.
    DMP mutual support number 174
    Total debt now (April 10) £0! - total paid off £30,221 or 100%
    I'm now debt free after 6 years!!:j
    Non smoker since June 2006 :j
  • Hobsch
    Hobsch Posts: 613 Forumite
    I would like to do my own DMP and may do so in the near future. I did work out my SOA and contacted the creditors without too much success but in hindsight I probably did not push hard enough and caved in too quickly.

    For example I made 4 phone calls to Barclaycard offering £62 per month (they wanted £91 plus the arrears). They refused everytime. Then I rang one day and said I was dealing with Payplan and they said they would accept 1% or £42 straight away with no quibbling.
    By that time I was too tired and dealing with Payplan. But I guess I am saying go for it - I would say the creditors would accept your offers eventually.
    Total Debt now £22,525.07 Start Debt £32,732.36
    £10207.29 OF DEBT PAID OFF:j 31.18%
  • Sugar_Coated_Owl
    Sugar_Coated_Owl Posts: 12,379 Forumite
    I'm doing that right now.

    I did get in touch with PayPlan but awaiting to hear back.

    I was on a DMP with allclear finance. It was a total nightmare and I cancelled my DMP with them last Friday evening. The past week I have telephoned a number of my creditors and offered a payment. Some accepted £5.00 a month without me sending my income and expenditure and the others I am in the process of writing to and including my income and expenditure and also my offer of payment.

    In a week I've been more successful with my offer of payments to creditors than an actual company was in 3/4 months. I feel much more in control now. Plus they were charging a £35.00 fee so now that extra money can be used to pay off debts :)
    --><-- Sugar Coated Owl --><--

    If you believe, you will survive - Katie Piper

    Woohoo! I'm normal! Gotta go tell the cat.
  • all_hours
    all_hours Posts: 684 Forumite
    Thanks for the replies.

    Sorry for the long post but this is going round and round in my head, I don't know what to do + writing it down helps.

    At the moment I don't have any defaults or arrears. I was turned down for a 0% CC - I've looked on Experian - nothing bad but I suspect it's too much debt for them to consider me at the moment.

    I don't know if a DMP is the way forward though I don't know what else. I doubt any creditor would push for bankruptcy as there are no assets to sell off and they would have to take what they get. I don't want any more credit and a mortgage is out of the question so black marks on my report would be ok (I've just realised this, I've been keeping things afloat so I could buy somewhere + adding to the debt as I do this)

    My LO will be starting school in September. We'll find out where we've been accepted in the next two weeks. Then I'll have a better idea of travelling times and childcare costs and I can look for a job and somewhere cheaper to live based around that.

    The other option is to get a job first, move to a cheaper area and apply for schools then. That's taking a risk as we would go through the clearing process and could end up at a poor school or it could make it difficult to get to work on time.

    One of my creditors is who I currently bank with. I'd need a bank reference to get a new flat, would a DMP prevent this and would I need a new current account?

    Any more ideas about this would be greatly appreciated.
  • milliejon
    milliejon Posts: 1,052 Forumite
    When I first started reading your post, my first thought was that you should write down your income and expenditure using the guidelines from the National Debtline. This will give you the balance you have left for your debts every month. If the amount left is less than you pay off your credit cards etc every month, then I would suggest doing the DMP.

    However, this was then complicated (in my mind) when you mentioned possibly moving home and needing your bank to act as a referee. I rent and have done for a long time, I have needed referees in the past, but these are usually the current landlord and a personal reference (usually work). But, also if you have to include your bank in a DMP they may close the account. My bank had a huge overdraft which I had to include in the DMP, before I did the DMP (and before I started getting late payments/defaults on my record), I moved banks. I made sure my new account was working properly, ie my salary was paid in and my dds etc were coming out. Then, because I didn't have my salary paid into my original bank account it was closed and the debt moved onto their claims department as I'd breached the account rules by not having a certain amount paid into the account monthly.

    Also, I didn't understand (sorry) the reference to school. Are you paying fees for school? If so, then I don't know where you stand (but I'm sure somebody will help).

    If you did a DMP now, and things changed in the near future, you can always contact the creditors to let them know about the changes asap. I've recently been able to increase payments for 12 months (I've just had a new baby so have more Family Tax Credit for the first year), but I warned them that the payments will decrease in January. They probably take no notice of the warning, but at least I feel like I've done the right thing and they can't say they weren't aware of it.

    I spent months thinking about doing something about my debts before actually doing the DMP, but it was the best thing I could have done. Within a couple of months, most of the creditors had agreed to the plan, and stopped interest and other charges. The ones that didn't agree I kept writing to them until they did agree. All of my debts are now paid a pro rata amount each month, and I never miss a payment now. If everything goes to plan, I should be debt free within 5 years.

    My tip is that all contact with your creditors should be in writing and all letters sent recorded delivery (or at least with a proof of postage). Keep copies of all your letters too.

    I hope this helps you decide what to do.

    If you have any other questions, write them down here. I'll keep checking back.

    Best of luck.
    DMP mutual support number 174
    Total debt now (April 10) £0! - total paid off £30,221 or 100%
    I'm now debt free after 6 years!!:j
    Non smoker since June 2006 :j
  • all_hours
    all_hours Posts: 684 Forumite
    Thanks for your comments milliejon. I downloaded the debtline pack a few nights ago, after reading one of your posts on another thread. Thanks it's very useful. I also got the flash program that works out the pro rata payments.

    Sorry, I've read this back and it sounds like a right old whinge.

    At the moment my income is a combination of tax credits, housing benefit, CSA payment and a small amount of personal earnings. The CSA payment is unreliable. He changes jobs/home and doesn't inform them, so there will be months where I don't get it at all or it's late. Because the HB take this into account, it goes up and down with each change, but it takes months to get reassessed - everything is permanently up in the air.

    Moving isn't essential but the flat we're in is small & expensive. It's feasible that moving could reduce the rent by £100 per month. The HB doesn't go through my account so, though my relationship with the bank is still good, I wouldn't get a bank reference stating that I can afford any rent.

    The school would be a standard state school. Sorry, I didn't explain this well at all. I don't have anyone to rely on for dropping off and picking up. I either do it myself or pay a childminder. The schools have different start and finish times and I'll be near different tube lines. It affects the time I can start work, where I can travel to, and how much childcare I'd have to pay. What I would do if I can't get a childminder? :confused: There are only a handful registered as picking up from each school and they will only have a few places each.

    Then there's, will I get a job. For various reasons I've had a long break. Another possibility is to get a temporary junior role for the summer (without the break I'd be classed as intermediate). Then apply for longer-term positions while I'm in work.

    I posted my SOA a few weeks ago. I've made a few small changes, a balance transfer + shopping to cook rather than use the microwave. But it's this week I've had my real light bulb moment. I can't continue with all this uncertainty and need to make some big changes. I know my situation isn't as bad as others on here but if I don't do something it will only get worse.

    Thank you again.
  • john_kent
    john_kent Posts: 425 Forumite
    I found that a lot of creditors didnt accept my offer. yet as soon as I registered with CCCS , i got a pack and forms , sent off forms with same offers and all accepted apart from one. SO yes , it can be done , but always keep all creditors up to date.
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