Debt Management Plan - 2 Questions

shazza1961

Hi Guys,
I need your help,
I am seriously considering a DMP, i just cant see the wood for the trees !!

I have the following debts:
£11000 Loan - Abbey
£3000 CC -Capital One
£800 CC - Loyds TSB
£1800 Overdraft Lloyds TSB
£800 - Catalogue NEXT

1) My question is would I be best to put the Lloyds TSB debt onto the capital one card ??? (not so many creditors to deal with then?)

2) If I did that would I be able to keep my Lloyds TSB bank account if I cancelled the overdraft facility??

Nearly forgot, what happens with your mortgage when you have a DMP? are the two kept seperate?
Any advise is very gratefully received,
Thakyou
Shazza

gibboking

Hi I went on a DMP through CCCS (link at top of page) in may, and they are very helpful and have lifted a great weight from me.
Like you i have several creditors, heres what happens if you call cccs or similar (make sure they are not going to charge you as cccs are completely free).
Make the first call, an agent will take your name address etc, they will arrange a convenient time for a counsellor to call you back for your telephone appointment, for this you will need at least an hour.
Between first call and appointment call you will be sent a pack asking you to detail your income and outgoings, the more you list the better. CCCS will probably think of things you hadn't as they have to allow you money for clothing, hobbies even going out (even if you don't, they have to allow you a quality of life) car tax and other little bits.
You need to get upto date balances of all debts, and if you go ahead with CCCS or similar they will want a copy of your latest statements so they can get accurate details and addresses etc.
Then appointment day comes, i had all the papers sorted and was dead nervous, but i neednt have been, the guy was very friendly but straight to the point, he asked how we had got into this situation etc, then we went through the finances, he worked out all priority payments, everything excluding debts. Then whatever was leftover was what i could reasonably afford to repay to my creditors.
I was hoping i could do an iva where your debts are finished in 5 years but we didnt have enough extra cash every month to do that, so we went for a DMP for now which at the moment will take 17 years to pay off all of our debts.
But you get yearly reviews and if your circumstances change then your plan can be adapted.
once you have finished the call you will be sent everything you discussed in the post for you to look at so you can decide what you want to do.
My life has been so much less stressful since i have been on this plan, and coming on here makes me save even more so i can throw lump sums at it too!
I hope this helps and i havent waffled to much.
Good luck

chevalier

Hi there
To try and answer your questions. You could balance transfer one debt to another provider, if they will let you, and if the APR is less with the other provider. Alternatively you can put all of the debts into the snowball calculator (there is a link to this at the top of the chat forum), and it will tell you which debt to prioritise first (highest APR), and you then pay as much off that one as you can a month, and do minimum payments on the others.

Secondly regards your mortgage. As this is a debt it will (I think) be included in a DMP. We could give you some extra advice if you post a Statement of Affairs (SOA), there is a sticky from southernscouser at the top of the forum about this. By detailing all your incomings and outgoings, there may be savings you can make, that would mean you had more money to throw at your debt.

Best of luck
chev

gibboking

My mortgage was not included in my dmp, i just had to give details of payments etc. My mortgage provider doesnt even know about the DMP.
What i did do though was to reduce my repayments from repayment to interest only for a short while to help get out of this mess, and i will be putting it back up after xmas, as i have started a new job with increased pay PHEW!!!

skintasusual

DMP are for usecured debts only I believe

therefore you must continue to pay your mortgage as usual, it will NOT be included in the DMP

CLAPTON

lets get this right

the mortgage is NOT part of a DMP, if you don't pay your mortgage you are likely to lose your house.

i would not advice moving debts around just before you default on them...your creditor ( Capital one) will be unhappy for you to increase your debt to them by 2,600 and then immediately default it.

joolz43

Entering into a DMP is about agreeing not to incur further debt including that which happens by moving it around. As Clapton said, Capital One is likely to take a dim view on you transferring a balance then defaulting. I had bought something for about £20 before I told them I couldn't pay and they weren't happy with that!

My DMP is about my light bulb moment, about the realisation that I can borrow no more. Open a new bank account before you start the process and forget about transferring the debt.

Wonder_Girl

shazza1961 wrote:

Hi Guys,
I need your help,
I am seriously considering a DMP, i just cant see the wood for the trees !!

I have the following debts:
£11000 Loan - Abbey
£3000 CC -Capital One
£800 CC - Loyds TSB
£1800 Overdraft Lloyds TSB
£800 - Catalogue NEXT

1) My question is would I be best to put the Lloyds TSB debt onto the capital one card ??? (not so many creditors to deal with then?) - NO, You are about to ask Capital One if they will accept reduced payments, they will not agree to this if you have just increased your debt unnecessarily! also this is highly unfair to your other creditor, you should not treat Lloyds any better that you treat the others, this will just aggravate them

2) If I did that would I be able to keep my Lloyds TSB bank account if I cancelled the overdraft facility?? No, part of your terms and conditions of a DMP is that you stop using any and all credit facilities and downgrade to a Basic bank account, You will need to open a basic account with a bank that is not affiliated with anybody you owe money to.

Nearly forgot, what happens with your mortgage when you have a DMP? are the two kept seperate? Your mortgage and all your bills (Council tax, gas, water etc) are PRIORITY debts, it is your full responsibility to keep these up to date, a DMP will only ever include UNSECURED debts (credit cards, store cards, overdrafts, loans, catalogues, shortfalls etc)
Any advise is very gratefully received,
Thakyou
Shazza

Have you posted an SOA? Can you meet the minimum payments if you make a few cutbacks? If you have already been through this I apologise, if not post it here and we will be able to give you better advice.

Take care

WG XX