A couple of DMP questions.

lita

Hi, I have just used this website as recommended in one of the stickys http://www.cccs.co.uk/ and it has suggested to start on a DMP. I have a couple of questions that I am unsure about if anyone could help please.

1. Does having a DMP make a mark on credit reports?

2. What would happen if OH was able to do a bit of overtime? How would this extra money be taken in to account?

3. We need to move house ASAP (we own our own). Would this have an affect on us doing this?

4. Do we stay on the DMP until the debts are cleared or just until we are able to make the payments comfortably by ourselves?

TakingControl

Hello, the below is only my personal experience.

1. Does having a DMP make a mark on credit reports?

It will have a adverse affect on your credit report. I had 5 creditors, 2 placed a default on me as soon as I entered the DMP as I breached the credit agreement whereby the other 3 marked my account as satisfactory, didn't even mark late payments. One of these 3 creditors accepted a F&F off 55% dispite only being in a DMP for 14 months. One defaulted creditor accepted a F&F of 75% after being in the DMP for 8 months. However the 2 defaults screwed up my credit rating anyway.

2. What would happen if OH was able to do a bit of overtime? How would this extra money be taken in to account?

Is the DMP a joint one or are the debts only in your name?

3. We need to move house ASAP (we own our own). Would this have an affect on us doing this?

It would if any of your creditors place defaults on you or do you mean renting?

4. Do we stay on the DMP until the debts are cleared or just until we are able to make the payments comfortably by ourselves?

I informed my last 3 creditors that I have financially stabilised and have started making more than the minimum payments again. A DMP is an informal agreement which both parties can cancel at anytime.

lita

TakingControl wrote: »

Hello, the below is only my personal experience.

1. Does having a DMP make a mark on credit reports?

It will have a adverse affect on your credit report. I had 5 creditors, 2 placed a default on me as soon as I entered the DMP as I breached the credit agreement whereby the other 3 marked my account as satisfactory, didn't even mark late payments. One of these 3 creditors accepted a F&F off 55% dispite only being in a DMP for 14 months. One defaulted creditor accepted a F&F of 75% after being in the DMP for 8 months. However the 2 defaults screwed up my credit rating anyway. All our debts are with the same creditor (Lloyds TSB). It sounds like we might be lucky, we might not be :S

2. What would happen if OH was able to do a bit of overtime? How would this extra money be taken in to account?

Is the DMP a joint one or are the debts only in your name? It would be a joint one.

3. We need to move house ASAP (we own our own). Would this have an affect on us doing this?

It would if any of your creditors place defaults on you or do you mean renting? I mean buying a new house. The mortgage is also with Lloyds TSB

4. Do we stay on the DMP until the debts are cleared or just until we are able to make the payments comfortably by ourselves?

I informed my last 3 creditors that I have financially stabilised and have started making more than the minimum payments again. A DMP is an informal agreement which both parties can cancel at anytime.

Thank you so much for replying

surrey648

Hi... again these are my personal experiences!

1. Does having a DMP make a mark on credit reports?

It will have a adverse affect on your credit report. I had 5 creditors, 2 placed a default on me as soon as I entered the DMP as I breached the credit agreement whereby the other 3 marked my account as satisfactory, didn't even mark late payments. One of these 3 creditors accepted a F&F off 55% dispite only being in a DMP for 14 months. One defaulted creditor accepted a F&F of 75% after being in the DMP for 8 months. However the 2 defaults screwed up my credit rating anyway. All our debts are with the same creditor (Lloyds TSB). It sounds like we might be lucky, we might not be :S Lloyds have been my biggest pain. They defaulted me the minute the DMP was set in motion. They constantly update Equifax to say that they haven't been paid, but then show my credit limit reducing each month! Also, they like to add adverse credit comments. Sorry for the bad news!!

2. What would happen if OH was able to do a bit of overtime? How would this extra money be taken in to account?

Is the DMP a joint one or are the debts only in your name? It would be a joint one. As a joint one, unless the overtime is regular, it wouldn't be wise to include it in your DMP. Otherwise on the months when you don't have it, you still have to pay the same to CCCS. It's worth saving it up, and making adhoc payments to CCCS, which are then split equally between the debts.

3. We need to move house ASAP (we own our own). Would this have an affect on us doing this?

It would if any of your creditors place defaults on you or do you mean renting? I mean buying a new house. The mortgage is also with Lloyds TSB. Can't really comment on this - see comment at 1 above. Are you keeping the mortgage with Lloyds, and are you currently in arrears? I'm sure some of the other more experienced members can help with this one!!

4. Do we stay on the DMP until the debts are cleared or just until we are able to make the payments comfortably by ourselves?

I informed my last 3 creditors that I have financially stabilised and have started making more than the minimum payments again. A DMP is an informal agreement which both parties can cancel at anytime. As above - just make sure you can cope with the payments again . There are lots of helpful tools/templates on the CCCS member area of the website, and they're always helpful by phone or email throughout the term of the DMP, so later on they'll probably be able to give you some guidance!


Good luck!!!

dancingfairy

Yes it will affect your credit file as even if the companies agree (which they might never officially/formally accept it in writing) it's still not the original payment you signed up to so they can and will place defaults on your credit file.
Yes this is likely to make it very difficult to buy a house in the near future although the longer the time from the deafult and the more your file has recovered the easier you will find things.
As overtime is not guranted you will probably wish to save it up and use it for emergencies as otherwise if payments go up and down each month the creidtors won't know what is going on - stick to a basic budget and keep back any spare - unless you are reasonably confident the overtime will be semi-permanent - perhaps after a 6 month review you can add it to the dmp if the overtime is still ongoing and you have settled into the swing of being on a dmp.
Oh you would probably stay on a dmp until the debts were settled as otherwise you risk them piling all the stopped interest and charges on again. If all goes well you may be able to offer full and final settlements to get shot of the debts after a few years. You can always take over the running of the dmp yourself after a while if you want to.
df

lita

Well I have no idea what to do now!! I have just put up my SOA with the hope that someone can see a way out of this mess

Thank you all so much for replying.

surrey648

Unfortunately there is never a "one size fits all" to debt solutions .... deep breath my fellow debt-free wannabe!

I guess your biggest question is over your house move. If it's essential, can you keep up debt payments until you've got the move sorted? It'd be easier to sort your mortgage without Default Notices stamped on your credit file. I sold my house before I started my DMP, in an attempt to avoid going down that line... wish now, I'd stayed on the property ladder. If you start your DMP, but then find you can't move because of it, it could be many years before you can get an acceptable mortgage offer again. [note: I'm no expert, but this is just what I've found with my DMP]

Hopefully, now you've posted your SOA, some greater financial minds might be able to give you some guidance!

RAS

Hi

If your overdraft and other debts are all with Lloyds, you MUST open a new bank account with an unrelated provider immediately.

As it is what you risk is that Lloyds will use your OD bank account to continue paying the DDs for all your other debts, negating the DMP.

If you do not move the bqank account, they may also just decide to offset your income (salary and benefits) against yopu debts, leaving you no money. This is legal.

You really do need to get out to work to bring in a bit more money, as it would be tax free.