Advice please

donewithcredit

Hi, like many others ive been looking at advice on her for some time but this is the first i have had the courage to post. Basically my husband and me have approx 26k of mainly credit card debt. Included in this is a 4k overdraft with santander. We are currently making all the minimum payments. The problem is we have no cash for emergencies, car tax, servicing etc. If we need any cash for anything that is not essential we have to put it on a credit card. I am worried sick and know that we are never going to be able to pay this back. I have done a debt remedy with CCCS who advise a DMP.

I have received the pack this morning. Can anyone please answer the following.

Do we need to wait until we have a new bank acoount before we inform the creditors?

I have an hire purchase agreement for my car, one of those that requires a final lump sum payment after three years. How will a DMP effect this?

Are we doing the right thing?

Thank you

dreamdreamer

Well done on facing your debt-demons!

Just as a first line of thought - how were you planning on paying the lump sum payment (and how much is it)? On credit? If so this will not be an option on a DMP as you won't have any credit available to you. If you don't pay it presumably you have to give the car back?

Emergencies are a common fear amongst debt-busters but car tax and servicing will be accounted for in your outgoings on your DMP if it's in your SOA. Actual emergencies happen so rarely, ie. water pipe bursting, roof caving in etc that the likelihood of it happening while you're on your DMP is very slim. If you're really worried then once you start your DMP you could either tighten your belts a bit more or increase your income (there's an Up Your Income board for inspiration) and put into an emergency fund.

I'm not sure on the bank account question I'm afraid but I'm sure someone who's been there will be along soon!

Dreamer x

Tixy

You do need to wait for your new bank account to be set up before you start informing creditors, but you should still be able to start completing the CCCS pack as it usually takes a month or so for your DMP to be set up.

Your HP normal payments would be kept outside of the DMP and you would continue these as normal.

As dreamer says above how had you planned on paying the lump sum if you didn't do the DMP? How much is it? Is a car essential to you? Could you purchase a cheap car for less than this lump sum? How long until the final payment?

donewithcredit

Thanks for your reply Dreamer,

The car is one of my main worries because i need it to do my job, not just to get to work. The lump sum will probably be about £3.500. As a last resort i could ask my dad for a loan, but i really didnt want to do this as he has no idea about our finances, thanks again

donewithcredit

Hi Tixy, I normally renew the car at the end of the agreement but i dont think this will be an option on the DMP. Its one of those lease to purchase agreememts. If that makes sense