FFO on DMP

surrey648

Hi all!

I've been on a DMP through CCCS for four years, with an estimated 2+ years to go. [50k paid off.. :eek: but 30k to go]

I've been reading that some others have managed to present FFO to creditors, and had them accepted at around 50% of the outstanding debt!

My questions are:
1. What is the likelihood of getting that level accepted?
2. Is it dependent on how much is outstanding?
3. Is this better being done through CCCS or to approach independently?
4. If an FFO is presented, but not acceptable to me (i.e. I can't afford it), is this detrimental to my DMP.

I'm not quite in a position to FFO yet, but I live by my financial spreadsheet and I'm planning for my DFD - It's looking a long way off, and want to bring it closer by finishing my DMP, making that fresh start and saving for my debt free future!

I have had some sporadic overtime, and been banking it like mad, and although I know I can make additional payments to CCCS, it seems sensible to tuck it away, so that I can make a FFO therefore making the most of the money. Believe me, I am not trying to make light of the debt, or get out of paying it back... but if others can reduce their payment I feel I should try?!

Any thoughts would be appreciated!

Tixy

Hi

1 If your debts have been sold on to third party debt collectors then the chance of F&Fs being accepted at around 50% are reasonably good. You might even want to start by offering a bit lower.
2 Its dependant on so many things, yes how much is outstanding but also how much you are currently paying so how long it will take to repay, plus how stable they consider your payments to be and literally even things like what day of the month/quarter/year you make your offer (as if its coming up to a qtr end or year end they may more desperate to collect in money so more likely to accept F&Fs).
3 If you do it through CCCS you would need to have sufficent money to make F&Fs to all creditors at the same time, as strictly all money must be split equally between your creditors.
A possible way round to do F&Fs gradually to each creditor is to make the offer yourself and to put in your letter that this money is being offered to you by a relative who will give/loan it to you on the condition that it pays off a debt in full. Also write if they don't accept your offer by X date the money will be offered to another creditor. This way if they refuse your F&F they cannot come back to you and say that they now know you have £2k in the bank and want it paying towards your DMP so they get their fair share
4. Only offer a F&F that you can afford. If they come back and say they want a bit more but you cannot afford it then don't accept it. It should have no impact on your DMP if you then just carry on as you are (providing you have told them its not your money).

If you do an F&F and pay off one creditor you then tell CCCS and they will split your payment pro-rata to the other creditos.

Hope that might help? Also national debtline website has a factsheet on F&Fs and the things you need to ask for in your letters.

surrey648

Thanks Tixy!
I have read the information on the CCCS website, and just wanted a few opinions on how it works in practice/other peoples experiences. There is a template letter on the CCCS website, and a FFO calculator, which gives an indication of the amount that you should offer each creditor based on the amount that you have available. However, I wasn't sure how low was too low? Obviolusly I should (with my fingers crossed and a tight purse) have slightly more to offer over the next months, so don't want to make the offer too early!
Really like your suggestion of saying it's not my money - hadn't even thought that they would demand that money once they knew I had it!
Only one debt has been sold on, which is making me think that the others might not be so keen - have been making regular reasonable payments, and up until the DMP I'd never made late payments!
Also, love the idea about waiting until the end of the quarter - of course, now I think about it, it makes sense!
Thanks again, every bit of advice helps!

Tixy

In your circumstances I think the potential issue with creditors accepting low F&Fs is that you expect to be able to pay in full in 2 and a bit years, so for them it might not be too long to wait for their money. Thats not to say they won't accept any offer but it reduces the chance of the really low ones.
DCAs on the other hand are greedy and always want their money as soon as they can. I wouldn't offer as much as 50% as a starting offer to a DCA - I'd start at something like 30% and they may just accept or may come back with a counter offer. Plus it always leaves you the option of upping your offer a bit.

If you make an offer and they do refuse then there is nothing to stop you trying again a few months later when you have a bit more available.