DMP Mutual Support Thread - Part 7

grantalien

cowbag789 wrote: »

Hi there, i was just wondering if anyone could clarify a few points about DMP's for me, I have been through the CCCS online questionnaire which suggests a DMP but i dont fully understand the implications. Does anyone know the answer to the following...
1.Firstly, all of my debts are on credit cards these are with MBNA, Halifax, Tesco, Lloyds, Egg, and Barclaycard. How likely is it that they will actually freeze the interest? If you do begin to arrange a DMP and the companies won't freeze the interest is there a way to back out of the arrangement?they may freeze they may not - there really is no rhyme nor reason - you can back out at anytime but suggest that you dont unless you are able to meet the minimum commitments - remember these may change if you have been on the plan a while (could be more or less) a DMP is designed to help you repay your debts in a manner that is affordable and supports your priority debts
2.Also what impact does the whole thing have on your credit rating?it will impact on your credit rating as you are effectively breaking the terms and conditions of the original agreement - it will happen anyway if you start to fall behind with normal payments - defaults maybe issued and there is the possibility of CCJs etc - creditors do not have to accept the plan but its normally in their interests to do so
3. I've seen lots of advice about opening a different bank account, is this neccessary if you don't have any debt with the bank you hold your current account with?yes i've read someone saying their bank account was frozen while their dmp was set up?? surely thats not helpful.setup a "basic bank account" with a bank not related to any of your debts - you cant have a cheque book or OD this is extra credit
4. will a dmp have any impact on my mortgage? (it's all paid up to date and never missed a payment or anything.should not - DMPs are designed to enable you to continue meeting these priority debts - it may have an impact if you change in the future but as I have stated if you get into difficulty this will impact anyway

any help would be appreciated.

Hope that helps and good luck - if you are struggling to make payments it does help - the round is long and winding but at least you have a destination at the end of the tunnel!:A:T

197228

Thanks Twitty, Mikon and HH for replies and support, i set up DMP to get my finances under control but don't wont to be worried everytime the door goes!! I have read through he pages on here and have yet to come accross debt collectors at doors, thanks for putting mind at rest. cheers 197228 Dave

ianmak

sunfleur wrote: »

Yesterday we had an odd letter from one of our creditors - it's not for that much money compared to the main ones. We had sent all of the creditors the usual template letter that CCCS supplied and we also included a letter of our own explaining financial difficulties etc etc. The letter we got yesterday was only one line long and it said that everything had halted because our account was in dispute! We haven't said our account is in dispute at all. Told them we would pay our debts back as soon as we can and that we were doing this through CCCS etc. When I rang CCCS to tell them about this they said they wondered whether they had sent us the wrong letter out LOL It will be interesting to see what letter we get from them next LOL

Are you sure it's not a letter saying that your account is in dispute and so on hold (so you can't take further credit from it)? I'm sure I had a couple of similar letters.

ianmak

cowbag789 wrote: »

Hi there, i was just wondering if anyone could clarify a few points about DMP's for me, I have been through the CCCS online questionnaire which suggests a DMP but i dont fully understand the implications. Does anyone know the answer to the following...
1.Firstly, all of my debts are on credit cards these are with MBNA, Halifax, Tesco, Lloyds, Egg, and Barclaycard. How likely is it that they will actually freeze the interest? If you do begin to arrange a DMP and the companies won't freeze the interest is there a way to back out of the arrangement?
2.Also what impact does the whole thing have on your credit rating?
3. I've seen lots of advice about opening a different bank account, is this neccessary if you don't have any debt with the bank you hold your current account with? i've read someone saying their bank account was frozen while their dmp was set up?? surely thats not helpful.
4. will a dmp have any impact on my mortgage? (it's all paid up to date and never missed a payment or anything.

any help would be appreciated.

Further to what grantalien said above, just to say that you can keep your existing bank account as long as:
a) it's not linked to any creditor.
b) you don't have an overdraft on the account. If you do, get it removed. As far as I'm aware, you're still allowed a cheque book.

cowbag789

thanks for all the help, i'm still a bit confused about the best way to go really, i can (just) afford my minimum repayments but it is costing me about £500 a month and several of my cards have had the rates hiked to about 29.95% so my minimum payment is effectively paying off about £5 a month! i have always paid slightly more than the minimum payment on all but my cheapest card but it still feels like i could be paying them off for 20 years, i'm just very frightened of thing like ccj's and never being able to get credit again.

MadamMim2013

ukjs1976 wrote: »

P.S. As others have mentioned, I have not signed the letters to the creditors but have printed my name in block capitals after the 'Yours faithfully'

We did exactly the same last night! Thank goodnes for MSE!!! :T

ianmak

cowbag789 wrote: »

thanks for all the help, i'm still a bit confused about the best way to go really, i can (just) afford my minimum repayments but it is costing me about £500 a month and several of my cards have had the rates hiked to about 29.95% so my minimum payment is effectively paying off about £5 a month! i have always paid slightly more than the minimum payment on all but my cheapest card but it still feels like i could be paying them off for 20 years, i'm just very frightened of thing like ccj's and never being able to get credit again.

20 years plus... Could I ask if you're still borrowing off the cards?

With a DMP you're looking at an end to it all, however far ahead. As regards Credit in the future, yes you will be able to get some again, but do you really want it? Personally I'd love to be able to save for things in the future, like people did in the olden days.

ljm21

I've not posted for a while as things have been hectic. Basically I was maxed out on credit and couldn't handle any unexpected expenses, then the boiler broke, care brokedown, big bill for damp proof course. So I got in a mess with payday loans. I contacted payplan and they said they could help. So I stopped all payments, made token payments etc. I am due to maek my first payment to payplan in September, but now they tell me that they can't help me. This is because my payments under the DMP would be above my contractual payments.

So now I find myself in a situation worse than I was before. I had contacted all my creditors to discuss stopping interest/ reduced payments but all said no. I don'tknow what to do, Does anyone have any advice?

ianmak

ljm21 wrote: »

I've not posted for a while as things have been hectic. Basically I was maxed out on credit and couldn't handle any unexpected expenses, then the boiler broke, care brokedown, big bill for damp proof course. So I got in a mess with payday loans. I contacted payplan and they said they could help. So I stopped all payments, made token payments etc. I am due to maek my first payment to payplan in September, but now they tell me that they can't help me. This is because my payments under the DMP would be above my contractual payments.

So now I find myself in a situation worse than I was before. I had contacted all my creditors to discuss stopping interest/ reduced payments but all said no. I don'tknow what to do, Does anyone have any advice?

Have you posted an SOA anywhere on the forums, to see if you can make any further cutbacks? If PP are saying that you're payments are above your contractual payments, then you should have enough to pay off the payday loans? With regards your budget with PP, have you taken everything into account, to ensure you haven't missed anything out?

ljm21

thanks for the response and no I've not posted my SOA but I am happy with it. Nothing more can be taken out.

My problem is I can make the payments to my loand and interest payments to the payday loans. This leaves me with less than on the debt management plan, but the difference is negligible. The prolem is I will never be able to pay back the payday loans how things stand.

Payplan are strugling because my contractual payments are lower than they are offering with the DMP. Ie I am paying more on a DMP.

They have all my financials since 18 June and now they tell me this. So now I have racked up late fees and interest charges. So I find myself worse off than before

Lisa