Is debt management the nail in the coffin?

Scott78

This is a course of action I am contemplating after struggling along on my own, I am just about to hit 20k in unsecured debt and are right on the edge and stuck paying minimum amounts on the couple of cards, we have tried to reduce our debt and have done so slightly but feel I need a structured plan and was surprised when I got a quote over the phone about the level of payment and the time it would take to clear it. Anybody got any ideas who I should go with, what the consequences are ie is it harder to remortgage as I will be doing this next year.

Verbatim

If you're going on a dmp stick with one of the free debt charities (CCCS, debtline, payplan or CAB) who won't charge you so ALL the money you pay goes to the debts. Don't go near afee charging company.

Lulee36

Hi ,

Just to say this was the best thing I ever did ! im just under 3 years away from finishing my DMP and its a great feeling when I get statements in the post and actually see the balace getting lower and lower

Its very true what people say, in the first few months its very hard to get used to living without credit cards etc but once you retrain yourself to use your own money its a great feeling

Credit is far too easy to get these days and it may seem manageable at the time ... i always used to buy something and think its only another fiver a month and it soon mounts up

Its not nice to wish 3 years away but I cant wait for the end of my DMP just to feel I have acomplished it

You will find yourself shopping around alot more and rather than impulse buying take your time and look for offers and discount codes etc

Hope you get sorted -It really is the best feeling in the world to be able to open the post and answer the phone without breaking out in a sweat

Nargleblast

Scott78 wrote: »

This is a course of action I am contemplating after struggling along on my own, I am just about to hit 20k in unsecured debt and are right on the edge and stuck paying minimum amounts on the couple of cards, we have tried to reduce our debt and have done so slightly but feel I need a structured plan and was surprised when I got a quote over the phone about the level of payment and the time it would take to clear it. Anybody got any ideas who I should go with, what the consequences are ie is it harder to remortgage as I will be doing this next year.

Hello Scott and welcome. If you are planning to remortgage you may find it difficult to get anyone to lend to you if you are in some kind of debt management plan, as you will have defaulted on your debts. First thing to do would be to draw up a balance sheet of all your monthly income and expenditure, together with details of your current debts. If you look for the sticky at the top of the threads list (Sticky - first time posters, SOA calculator), do the calculator thing and post it on here then we can suggest ways of cutting costs and putting more towards debt repayment. If you can do that then you will keep a clean credit record and have more chance of getting another mortgage. However, if you are thinking of remortgaging to clear credit card debts, think very carefully before doing so. Lots on here have done just that and found themselves deeper in trouble.

Scott78

Hi Nargle, sorry I did not mke myself clear, my fixed rate period ends next june and will be put on the standard variable rate, I will not be remotgaging to clear debts I have just done an online debt remedy with CCCS and they quoted a price £450 over a time period of 3 years 10 months. Clearview finance gave me a quote of £249 per month over a time period of 6 years 10 months, are clearview one of the companies you recommend to avoid?

katsu

Scott,

The question to ask is "will clearview take some of your monthly payment for themselves?". I believe you will find the answer is, yes, they are a fee charging company. CCCS do not charge fees to you so all your money goes towards clearing your debt.

Use CCCS and be debt free quicker without paying someone extra for the priviledge!

Nargleblast

Scott - have not heard of Clearview but I suspect Katsu is right and they are a fee charging company. Also if you can manage £450 a month you should get debtfree quicker. The time scale quoted though assumes that your creditors will immediately freeze the accounts and stop adding charges and interest. In practice this doesn't happen for some time so you may be looking at a bit longer to pay off your debts. Have you looked into what the current standard variable mortgage rate is with your lender? It might be not that much different from your fixed rate due to the general drop in interest rates in the past year or so. I say this because once you are in a DMP your choices for borrowing are extremely limited due to the black mark on your credit file, so you might be stuck where you are for the next 6 years or so till your file clears. Something to think about and discuss with CCCS.

JES_F1

Just thought I'd add my vote for the CCCS. Starting my DMP at the beginning of 2008 was definitely the best thing I could have done.

The first couple of months or so are a bit grim with what seemed like an endless stream of letters and phone calls. But stand firm, ride the storm, and then it all settles down and I hardly hear a thing from creditors now.

All my creditors have accepted my DMP and frozen interest and fees, though some took considerably longer than others! For example, Amex, MBNA, and M&S accepted immediately while I had to battle with Nationwide for about 18 months!

Creditors usually accept the DMP for six or 12 months and then expect it to be reviewed. So far, I've found this to be nothing more than a formality. About a month before the period's up, I've e-mailed the CCCS, asking them to contact the creditor, explaining that nothing's changed, etc, etc. I've then received a letter from the creditor accepting the DMP for a further six or 12 months (or whatever).

Funnily enough, I found the scariest thing to be my first review with the CCCS! I'd set up my DMP online using their debt remedy so didn't actually talk to anyone at the CCCS until my first review, which was about six months after it started. I remember bursting into tears half way through! I think it was because the bloke was so nice and wanted to help - I was still feeling rather vulnerable and embarrassed about being a total muppet for getting into such a mess.

Though I'd very much had my lightbulb moment, I was still learning about the various DFW ways of doing things, and was keen to not increase my DMP payments at that point even though I'd had a small pay rise - he helped me adjust my figures without increasing my DMP payment.

By the time my second review came round last summer, I felt much stronger about everything, and was delighted to be able to increase my payments by almost £100 a month.

I think I could probably happily handle creditors myself now and manage my own DMP but decided not to rock the boat and stick with the CCCS. Being able to mention the CCCS to creditors seems to calm them down a bit. Also many creditors recommend the CCCS and are already used to dealing with them.

I know this will sound weird (and/or obvious) but I actually have more money available to spend each month than before starting my DMP. And being able to sleep and not worry about the phone ringing or what the post will bring makes it all worthwhile!

Good luck and very best wishes.

WhereDoWeGoFromHere

Hi, I am totally new to this, just signed up today so please bear with me ! Hope I have posted this in the right place.

I've noticed lots of people on here have used CCCS. I think we may be heading for a disaster ! In December we approached a company called Loans & Finance for advice regarding taking out a DMP or an IVA. After taking the details of all our debts (approx 70K and 25 creditors) Loans & Finance told us we qualified for and IVA, they told us to ignore all our creditors as they would deal with everything, and we paid them £1110 in December and again in January (which were admin fees). In February they passed our file to Baines & Ernst, who are now saying we do not qualify for an IVA as we 'earn too much'. They have therefore advised us to take out a DMP, which we have just signed up to.

Has anyone had any dealings with Baines & Ernst ?

Many thanks for your help

Sue

miss_missy

well done geniegal on facing up to your debts dmp seem to work very well and i dont think there a bad thing we didnt do a dmp so only know what people on here have said but they do work and help people generally feel happier and able to live again

Scott78 i have done a dmp but i would agree with everyone dont use a fee paying debt management company cccs seem to be very good and helpful from what people on here say also what nargle said about remortgaging i think can be true if your in dmp lenders are less likely to lend to you or they will be very high rates for lending it might be worth posting a thread to ask what others have found when on dmp and trying to remortgage

good luck