Best way to pay off DMP?

mummytofour

Hello everybody!
It hase been ages since I have been on this bored and life has been moving along quite fast in the mean time.I have decided that I have to pay off all this debt I have. Basically I have one yr left at uni and will be coming out with HUGE student debts so HAVE to pay of my DMP which is with the CCCS as I cant imagine paying the DMP and student debts off :-(

Ok, so I have formulated a plan which is not massively strict, so I think is doable and will allow me to clear most if not all of my debts in the next 12 months. It is tricky tho as I do have a lot of commitments financially in life anyway but I think I can do this.

Ok so far I have saved 350... towards the debt repayments. So I have 2 options, one is use the money I saved to pay off creditors along the way as I save, for example I have an OD which is with CCCS and stands at £425 so I could pay that off by the end of the month.. Or should I save up for all the debts and pay in one hit?

I did ask MBNA for a short settlement a few months back and they basically said NO!!

I am in a situation where I need my credit repaired as soon as possible and could do with advice on the plan of action. Please don't think I will be getting into more debt!!! I just think I may need to change my mortgage at some point due to family reasons.I know that to repair my credit will take a while tho....

Many thanks :-)

MyLastFiver

The best way to repay multiple debts is to throw anything extra (after DMP payments) at the most expensive (highest interest) until that is paid off, then start on the next one.

However if you get a lot of satisfaction from "debt-busting" then you could pay the smallest one first.

If you are on a DMP and all creditors have stopped interest then you could save the surplus up and basically repay your DMP early once you have enough to clear everything.

mummytofour

I would like to pay one at a time if possible but I am worried that it will rock the boat with the cccs or other creditors...

Deep_In_Debt

It won't rock the boat with CCCS - they encourage you to pay your debts off as quickly as possible.

As far as the other creditors are concerned, well they will be receiving more as what you were paying into the debt that you have cleared will then be distributed amongst the other creditors so they will be happy (ish) as they will be receiving more.

3431Anna

Deep_In_Debt wrote: »

It won't rock the boat with CCCS - they encourage you to pay your debts off as quickly as possible.

As far as the other creditors are concerned, well they will be receiving more as what you were paying into the debt that you have cleared will then be distributed amongst the other creditors so they will be happy (ish) as they will be receiving more.

So is it o.k to just pay anything extra that you have off one of your debts, I thought you couldn't do this as it shows favout to one account above the others I am trying to save up to help to clear my debts but one of them is only for about 57.00 to Next and on my plan i only pay 1.00 and they stil charge interest so its not realy going down, I could manage to clear this, should i jut do it or speak to payplan first thanks for any help

bargainbetty

If you have enough to clear a single debt, then contact the creditor, and say you have come into a small amount of money (bingo win, sweepstake at work) and would they offer a full and final settlement. If they will, and put it in writing, great, you save some pennies. If not, clear the debt, and then notify CCCS so they can redo your payments.

You cannot give one creditor more than another in percentage terms on your main plan, but there is nothing to stop you clearing debts early in full.

Good luck x

Deep_In_Debt

You shouldn't pay one creditor "extra" each month but it is ok to clear off one debt in full though and your payments then get redistributed amongst the other creditors.

Deep_In_Debt

3431Anna wrote: »

So is it o.k to just pay anything extra that you have off one of your debts, I thought you couldn't do this as it shows favout to one account above the others I am trying to save up to help to clear my debts but one of them is only for about 57.00 to Next and on my plan i only pay 1.00 and they stil charge interest so its not realy going down, I could manage to clear this, should i jut do it or speak to payplan first thanks for any help

If you have the money to clear the Next then I would suggest you do this especially as they are still charging interest. You'll need to let Payplan know though so they don't continue to pay them.

mummytofour

Fab, so basically what I was planning on doing. Save for one debt at a time and pay that off in full. Then tell cccs it has been paid via girf etc then other creditors will receive a bigger cut of the cake each month.

I have a next one owing too! £95, I have to say they have been amazing and I will pay them off soon. Smile have been sods and I found out that I owe double what cccs said, so smile must be charging intrest. Smile have also marked my credit file as 6666666 months in arreas, not as in an agreement. Sigh.....

Onwards and upwards. By the end of this month I will I pray have enough to clear 2x smile and 1 x next!

Numpty_Monkey

Make sure you make the offers in writing
http://www.nationaldebtline.co.uk/england_wales/debt_advice.php
section 5 sample letters,Full and Final settlement
and get it agreed in writing

Good luck:T:A


Edit to add
Just a thoght if Smile are still adding intrest why not use the money to make them a reduced F&F?

3431Anna

Deep_In_Debt wrote: »

If you have the money to clear the Next then I would suggest you do this especially as they are still charging interest. You'll need to let Payplan know though so they don't continue to pay them.

Thanks for the advice its helped me alot as I couldn't work out a way to pay balances off without getting into trouble from my other creditors, so this was a bit of good news, my day hasn't been very good up to now as I have had to have my old labrador put to sleep so it has been a very sad day for me he was 15 years old, hope everyone else is having a much better day