debt management plan

revelling_in_poverty

Hi just joined this forum today! I have a quick question..... I have been in a DMP for about 2 years (still a long way to go). I am receiving some money soon that could partially pay off my debts (but not fully). If my creditors agree to a partial settlement, how would that affect rebuilding my credit again. Is it better to reduce it, wait a couple more years and then be debt free??

Poosmate

Hi Revelling, have you discussed this with your DMP provider?

Is the interest frozen on all of your debts? I'm thinking that if you are not paying interest on your debts, it might be worth habging on to the money and having it earn you some interest instead.

If you are going to offer settlements then you need Full and Final settlements and to know that your credit file will be noted as satisfied. You need to get this in writing from the creditors too before paying them.

I'm not in a DMP with anyone but from what I've read on here, your DMP provider would distribute any extra payment you make to each of your creditors on a pro rata basis.

Who is your DMP with? Hope you are not paying a debt management company for it!

Hope that helps

Poo

DarkConvict

You should talk to your DMP provider about the money coming in, and discuss the opportunity of doing full and final settlements. There are template letters available.
http://www.nationaldebtline.co.uk/england_wales/debt_advice.php

Important bits to include in a letter
* Full and Final Settlement of the Debt
* Check file updated to show satisfied
* Balance to show £0/nil
* Neither they, the original creditor or 3rd party will pursue for the remainder as the debt is now considered settled in full.
* (can try for it, but uncommon to accept) Defaults will be removed from your credit file.

revelling_in_poverty

Thanks for the advice - with the CCCS, so not paying for it. So far I think all of my creditors have stopped the interest. Just want to be debt free asap - needing to move house and worried about not getting another mortgage etc. Never want to take out credit again, but that doesnt stop me from hating not being able to get it!!

fiscalfool

http://www.moneysavingexpert.com/loans/credit-rating-credit-score#vote