cccs - TOO GOOD TO BE TRUE?

ironmonkeystrike

SOA =

This is my SOA - Not sure if I filled it out right - I left the APR for each credit card as 0.0 as I dont know exact amount...

My problem is, I am constantly paying minimum credit card repayments... and I want to get rid of the debts completely.

I read somewhere, that I can send letters to my creditors in order to pause/freeze payments? I have seen sample letters of this on the national debt line site

I spend approx £500 per month on repayments. All miminum repayments.

Basically, my logic is telling me (I have £700 odd on my barclaycard for example) that if i pause my repayments to the creditors for e.g. 3 months, I can then save up to WIPE out the barclay card debt.... Is my logic correct? Thanks for your time... am really wanting to get rid of these credit card debts best way possible...


Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1425
Partners monthly income after tax....... 0
Benefits................................ 80
Other income............................ 0
Total monthly income.................... 1505

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 300
Management charge (leasehold property).. 0
Council tax............................. 65
Electricity............................. 60
Gas..................................... 80
Oil..................................... 0
Water rates............................. 20
Telephone (land line)................... 20
Mobile phone............................ 35
TV Licence.............................. 13
Satellite/Cable TV...................... 0
Internet Services....................... 10
Groceries etc. ......................... 400
Clothing................................ 20
Petrol/diesel........................... 80
Road tax................................ 15
Car Insurance........................... 35
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 20
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1193


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly.. .APR
halifax........................6400......130...... .0
smile..........................4177......85....... .0
mint...........................3991......90....... .0
Virgin.........................6000......110...... .0
egg............................1908......55....... .0
barclays.......................714.......20....... .0
Total unsecured debts..........23190.....490.......-


Monthly Budget Summary
Total monthly income.................... 1,505
Expenses (including HP & secured debts). 1,193
Available for debt repayments........... 312
Monthly UNsecured debt repayments....... 490
Amount short for making debt repayments. -178

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -23,190
Net Assets.............................. -23,190

Created using the SOA calculator at
Reproduced on Moneysavingexpert with permission, using Firefox browser.


Now... determined to sort this out ... I went to CCCS and did thier online questionnaire which they say takes upto 20mins. At the end I spoke to someone in an online chat window, asked me a few questions like how much petrol I spend, etc and adjusted my balance sheet.

What I see as too good to be true - as you can see in my SOA I pay £490 per month which are all minimum credit card monthly payments. After CCCS did thier calculations - they proposed either:

1. Bankruptcy
2. DMP (£137 as my surplus)

Now... does a drop from £490 to £137 seem a little too good to be true? Initially i thought "releif" some breathing space while I can save up... but then I thought hang on - thats way too small...

Has anyone used CCCS? What was thier surplus like?

Thanks for listening

happyhaddock_2

Hi I'm on a DMP with CCCS and pay them £326.00 per month. It's the best thing I've done, yes you trash your credit score (but it had gone anyway when we got into difficulty) but my creditors have accepted the plan and all but one have frozen interest and charges. Hope this helps

ironmonkeystrike

happyhaddock wrote: »

Hi I'm on a DMP with CCCS and pay them £326.00 per month. It's the best thing I've done, yes you trash your credit score (but it had gone anyway when we got into difficulty) but my creditors have accepted the plan and all but one have frozen interest and charges. Hope this helps

May I ask, what were you paying per month, before the £326? thanks.

lornz23

I am with the CCCS and it is the best thing I have ever done. I went from paying £500+ to paying £190. Like mentioned before my credit score is now rubbish but either way it was going to be but now I know when I will be debt free and I am now more in control!

Good luck!

dancingfairy

Hi - I'm confused as to how you think it is to good to be true -do you actually know what you are signing up for?
Basically a dmp is where you say 'hang on a minute I'm having problems' CCCS or another charity work out what you can realistically afford to pay youre creditors and send this out (divided up per creditor) each month on your behalf.
Firstly your credit rating will be trashed and you will have defaults all over the place - this will mean you will struggle to get any more credit for a long while - 6 years plus - which since you say you won't get more credit during the dmp it shouldn't be a major problem.
Secondly creditors do not have to freeze interest and charges - most do - eventually - I would be very surprised if they all agreed to stop interest and charges within 3 months - some can take up to a year and even then never formally agree with the payment plan
Thirdly it is an informal agreement and as such I believe does not prevent your creditors from taking you to court -o.k it is unlikely they will get judgement of more than you can afford a month but you may end up with CCJ's.
Fourthly even if they do stop interest and charges you keep paying your debt until it's gone - it doesn't have a finite length of time to pay it off like say an IVA would.
I am not saying don't do a dmp as they are extremely useful but you do need to know what you are signing up for.
df

Tixy

Have CCCS gone through all your SoA in detail? Looking at each cost etc? I am surprised that they have would agree with that figure of £137, some of your costs look very high (eg groceries) and it appears that your income might not be complete (eg if the £80 is child benefit for one child it should be £87 per month (£20.30 x 52/12)). Also does your partner not have any income/benefits etc?

I'd agree with your first thought that the proposed repayment amount does seem very low based on your SoA. But obviously you are showing a surplus of £312, and we don't know how CCCS came up with a figure of just the £137 you mention. You need to go through each item and see where their figures differ to yours.

As df says its not that a DMP is too goo to be true - its just that you need to understand the full implications and the possible responsees / actions from your creditors.

happyhaddock_2

I went from paying approx £850 to £326

fatbelly

My initial thought was that you should go with CCCS on their figures. Maybe save on the side for F&F deals as a 14-year dmp is a bit excessive.

But then I looked at your soa a bit more. Tixy is right that some of the entries seem a little high.

Your benefits figure is a rough approximation for Child Benefit only. Do you not get Child Tax Credit? I would expect around £26 per week or £112 per calendar month.

ironmonkeystrike

I am getting more and more aware of what the consequences of a DMP - thanks for the advice, this is all god for me.

I think I will speak to them over the phone and go over with a fine tooth comb then about living costs....

FYI we get child benefit which is 80 a month - thats why I put it. My wife and I receive no other benefits other than child benefit.

Losing my credit rating - well, I am refused left right and centre for any credit cards, so that doesnt bother me - right now.... in the future maybe, when getting a house or flat.

If i do go with a DMP - let's say I managed to scrimp and save large amounts, is there a way I can pay off the debts in one go?

or is it just a case of, if i change jobs, get a lovely big salary (i wish) then just tell DMP and the monthly payments are just adjusted accordingly, meaning I can never save up and pay all off in one (or several) lump sums?

ironmonkeystrike

fatbelly wrote: »

My initial thought was that you should go with CCCS on their figures. Maybe save on the side for F&F deals as a 14-year dmp is a bit excessive.

But then I looked at your soa a bit more. Tixy is right that some of the entries seem a little high.

Your benefits figure is a rough approximation for Child Benefit only. Do you not get Child Tax Credit? I would expect around £26 per week or £112 per calendar month.

80 per month.... what is F&F pls?

Tixy

Is your wife/partner not getting maternity pay?
You need to check out why you are only being paid £80 per month for child benefit - it should be £20.30 a week. Also have you looked into putting in a claim for tax credits? If not you need to do this and get all you are entitled to before you can finalise your statement of affairs - as creditors will be wondering the same questions.

F&F in a full & final settlement. Once someone has been on a DMP for a few years and the debts have been sold to debt collectors they will often accept a reduced figure to settle the debt.

But if you get a payrise then you do need to inform CCCS and will need to increase payments (subject to any increase in costs that might go with your increased earning) but basically CCCS expect you to do a new statement of affairs every 6months and go through all your income & costs etc again then. So any savings you were making towards F&Fs would have to be by spending less in areas than your SoA shows. So its generally slow going. But many people do finish their DMP by making offers.