Debt-free newbie - Payplan

Rachelsb

WARNIING - Long(ish) post

After reading many, many forums / posts (including lots from MSE) I have decided to take the plunge and ask you all a few questions if that's okay??

After building up huge debts over the last 10 years (including 'helpful' consolidation loans from my bank) - I have decided to tackle my debts, tell my husband and get everything sorted once and for all.

I am a complete spendaholic and take full responsibility for my financial position, however over the past year or so, my repayments have become so great that I have little, if anything, left to live on despite earning a reasonable salary.

I have always tried to make sure I met my repayments and have only ever missed a handful, despite having no money left afterwards. However this month, after an unexpected bill, I have missed three repayments with no way of being able to get back on top of them even on payday.

I knew my time of dodging the bullet was up. I contacted National Debtline, CCCS and Payplan and am about to embark on a Debt Management Plan with Payplan. I realise this may affect my credit rating adversely and attract unwanted attention from my creditors, but I think it may be the only way to get my debts cleared once and for all. I cannot ignore it any longer - it's time for me to grow up. SCARY.

Anyway, the people at Payplan seem very nice. They are not judgemental and have helped me work out an offer that would leave me with some money to live on.

However I would be grateful for anyone's experiences with Payplan and would love to have your thoughts on the following questions:

When is it 'safe' for me to start moving everything over to my new basic bank account? I haven't got the welcome pack with details yet, but I am expecting it in the next few days. Obviously the bank I am currently with and have o/d and large loan with, doesn't know I am entering a DMP (although it is something I have discussed with them in the past when they persuaded me to take out the last big loan) and I haven't missed any payments with them so I'm not sure how to handle the bank move.

Also, I have looked at a few forums and a couple of people have mentioned that when they have reached the end of the DMP the justabank service shows the debts are nearly off, but when they have contacted their creditors they find they still owe a significant amount. This worries me slightly.

Also, what happens if the DMP and my offer to the creditors is rejected by one or all of them - do I just go back to square one or will they get twitchy and start demanding more money?

Thank you all for bearing with this post - just so you know, you are all inspirational and it makes me feel better to know I am not the only one x

bottleofred

Hi Rachelsb and welcome to the forum,

Well done for starting to tackle your debts. Whoever you decide to go with for the dmp, make sure they don't charge for the service and indeed the ones you have mentioned don't. Regarding your creditors, some won't be at all happy, but they can't get blood out of a stone. I never had any creditors reject the offers they were given, so can't advise on this, but if they demand more money, don't let them bully you into paying more than you can afford. Someone with more knowledge than me should be along soon.

Good luck in getting sorted

lindann_2

We are with Payplan, it was okish at first, please do your basic bank now, because if you owe debts to the other bank, it could get crossed over, sort of thing. Yorkshire and co-op seem ok, Payplan, most of the creditors will accept them because you will have shown them how much you earn and what major bills you pay out mortgage/rent, et.. what is left its goes pro-rata to each creditor one owes the most get the most.. so to speak. lets of information letters to send to creditors, and if you have a problem let them deal with it. This they was good at, also you will be asked to pay insurance for the whole of the DMP. because if anything happens to you, your debts will be paid off, It is £5.00 per person. plus little something etc, far as l know.. its good value while your in debt, also they have other savings they try to help you with.. Also, you can pay them with your mastro, card, with your basic account.. etc... because basic banks do not have check books or overdrafts... also sort of your bills if they are very old ones, may unenforceable, so do a cca, check on them sending them a CCA with pound postal order. Do print your name not sign anything if you go down the cca route. its a lot to take in, but you will get there. Remember when your dmp, closing payplan will deal with the after effects, they told me some will waiver the interest charges etc. from justabank web site, so you will keep an eye on the amounts your paying out etc.

here is a basic letter you can send to all creditors

creditors address etc
date
ID:DMP XXXXXx
Dear Sirs
Re: Supervised Informal Arrangement
Client(s):

debtors name, account number balance £

Ms XXXXXX
I am writing to request that the charges that have applied to my account be suspended and if possible refunded. Should you,at any time in the future, not receive payment please contact Payplan and they will advise you of the reason.
May I take this opportunity to thank you for your continued support in what would otherwise be a very difficult time for me.
Yours faithfully
Ms XXXX

hope that helps

mrtom622

Hi
You are doing the right thing. I have been with payplan for about 15 months now and have had lot's of support from them.

Stick at it with payplan they are very good. if you have any problems with creditors give them a ring and they will sort it out for you.

You may find you will receve lots of letters and some phone calls but this will settle down. I have a long way to go yet and i wont say its easy but having payplan to help has made a big diffrence

Good luck with it and would love to here how you are doing.

Mr tom622