The start of a long process

time-4-a-new-start

Hi everyone

This is my first post but I wanted to share my situation and hopefully get some support on my new journey.

Basically I have been burying my head in the sand for the past 8 years or so. My problems started when I had to buy my house back after splitting with my ex.

At the time it was before the property crash so I was confident that I was taking a secure step for my future as house prices back then were crazy and starting at bottom of letter would have been difficult.

My mortgage payments were within my budget. Well just! But my problems kick started as i didn't factor the running house costs and also living costs being so high. So each month I would rely on credit, then some more the next and again the same next. When payments to credit cards got difficult I had little choice but to seek to refinance and continue to keep going. My backup plan if things got difficult was to sell the house, but the property crash put an end to that.

Over the years the debt continued to mount and I desperatly wanted to get help, but the problem with debt is that it is difficult to talk about it even to your family.

But today I have finally woke up to the situation I am in and am looking to resolve my debt problem. I am no longer to hide the truth and so at this time I am not afraid to say that at present my total debt is £52k.

I contacted the CCCS and was given two options - an IVA and a DMP. I have decided that as I got myself into this I want to get myself out and so have decided to go for a DMP. I am lucky to be still in full time work and so I am happy to pay what I owe back - not like our banks who when they face a problem they get us the tax payer to bail them out!!! There us def some irony in all this I tell you!!

I am going to setup a direct debit of £450 a month to pay direct to the CCCS to pay my creditors. I am in the process of setting up a new bank account as recommended by CCCS as one of my creditors is my current bank.

As I mentioned at the start, this process is just starting for me and so I have a few questions that I hope you could help answer.

1. From your experiences do creditors normally except a DMP? I am a bit worried that some won't and so I will have a similar situation as before ie paying money to DMP and paying other creditors who didn't agree to it

2. Again from experience do you find that creditors will stop charging interest when you enter a DMP?

3. A DMP states you are agreeing to repay your debt but what happens if your situation changes eg if a loose my job?

4. Do you have to tell your employer that you are in a DMP? I dont work in a bank or legal profession.

5. I know you are told that you should not borrow any more money when in a DMP, but is your credit rating wrecked or is it more to cap your debt?

6. Finally and prob most importantly to me, will my home be at risk now I will be entering a DMP?

This is the start of my journey and I hope to debt free in 8 years (but will be working hard to make this happen sooner). I hope that sharing my situation and also through your support that this journey will be smooth!!! I just wish I had taken the first steps sooner!!

Anyway thanks for your support

sparkle76

Hi there and thanks for posting your situation, I am not very knowledgeable in DMP but wanted to say hello and welcome, hoping that others will come along soon to advise you further.

One thing i can say is once you have it set up, look at other ways of saving money so that you can start to put money aside or even overpay debt. Save on groceries, bills, use cashback sites, make batch homecooked food and much more - this site is amazing for tips and people are so helpful.

Good luck on your journey!

Triggles

1. From your experiences do creditors normally except a DMP? I am a but worried that some won't and so I will have a similar situation as before ie paying money to DMP and paying other creditors who didn't agree to it

It depends. Some are more helpful than others. Often they will only accept the agreement if you are with an agency like Payplan or CCCS. Some are aggravating and will do whatever they can to get the money from you.

2. Again from experience do you find that creditors will stop charging interest when you enter a DMP?

Again, as above, some will, some won't. You've probably got a better chance of it by going through Payplan or CCCS, as they are recognised. I mention them because they are recommended here because they are a free service.

3. A DMP states you are agreeing to repay your debt but what happens if your situation changes eg if a loose my job?

The most important part of the DMP is communication. If you are with an agency and something like that happens, you need to contact them right away and let them know. They often will adjust things accordingly.

4. Do you have to tell your employer that you are in a DMP? I dont work in a bank or legal profession.

Nope, not unless you are in a profession that needs a clean credit/banking sheet. Or unless you are getting harassing phone calls at work, I suppose. Although there are template letters on site to help with this.

5. I know you are told that you should not borrow any more money when in a DMP, but is your credit rating wrecked or is it more to cap your debt?

Your credit rating is going to take a hit on a DMP. You'll be getting defaults on your file which will stay on for 6 years. But let's face it, if you are considering a DMP, you've probably either got a few dings on your credit rating already or are going to be soon. And you are not supposed to take on or open up any lines of credit on a DMP at all. IIRC the agency will have you sign paperwork, and I would imagine this would breach the agreement and they could dump you out of the DMP.

6. Finally and prob most importantly to me, will my home be at risk now i will be entering a DMP?

I suppose technically it could be. But your mortgage payments will be priority, so that's covered. The risk I imagine is a creditor going after it. But honestly I don't know much about that. I'm sure there will be more along that can answer that better than me.

Best of luck.

time-4-a-new-start

Hi

Thanks for the replies.

I am hoping to pay £450 a month, but am also planning to start saving money in another account (£150 a month) that will either act as a large lump sum to pay off the debt after a few years or as a backup if I do loose my job and so can continue to pay something.

As I said at the start this is the first time that I am taking proper action on the situation, but at the same time am worried as im not sure what will happen or what to expect from the creditors when I start my DMP.

Anyway I'm just waiting on my new bank account being set up before i can move forward with CCCS. I applied for it yesterday so hopefully I should have it this week.

Thanks for ur input so far!

Triggles

Best of luck with it. I will admit that initially it was a bit bumpy, but things have levelled out for us now, and it's not nearly so stressful. It's a good idea to put money aside for an emergency fund in case things like the washing machine or the refrigerator give up the ghost.

time-4-a-new-start

I'm just reading a bit more about bank off setting. As I said I'm moving my main bank account to another one so as to stop the bank thats a creditor taking all my wages each month.

However I read that they can go into any of their accounts to recover the money. I'm worried as the same bank is used for a joint savings account with me and my partner. Also i bought shares for a friend through their shares dealing account. Can they go into either of these accounts to take money?

Triggles

I don't know about the shares, but I believe they can go into savings account. All but one of our debts on our DMP is in DH's name, so savings goes into a separate account in my name only. The only debt that has my name on it is in a different bank system than the savings account. I wanted no surprises!

worried1969

Hi time-4-a-new-start, just wanted to say i have just started on the DMP route with CCCS papers posted Thursday with with all creditor details, would be good to support each other (debt of £32k) so like you is the start of my journey. The support on here is great, i am just waiting and hoping now my creditors will accept my payments. Good luck and keep posting.

massey_2

Hi
I am with CCCS and they have been great, it is the best feeling when the phone doesn't keep ringing from creditors demanding more money off you. My debt was 78K and have reduced it down to 61K this is a wonderful feeling. i picked up ccj's on the way but again only pay back what you can afford all my creditors stopped the interset and charges.
my advise to you would be to move all your accounts out of the bank that you have a creditor in then you will have some piece of mind and not worrying if they are touching your money.
You have completed the hard bit by admitting that you can't afford the payments to CCCS and once you have made that first payment to the CCCS and your creditors get a payment you will find that they stop hassling you and if they ring just tell them you are dealing with CCCS and give them your CCCS client number for them to ring

time-4-a-new-start

Hi everyone

Thanks for all your input today. I am worried about the joint savings account as if they start taking money from that it will alert my partner (it sounds like im chickening out but i havent got down the path of telling them yet as i am really worried they will leave me). I want to try and get the leg work done before saying anything, so at least it is showing that I am working towards fixing this.

My other problem with the shares is that my friend has bought £3k of shares through my share dealing account. At present they are worth £800 so there is no way he will want to sell them now meaning I wont be able to take out the the money before my DMP starts. The last thing I want is for the bank to take over my share account, meaning that I will owe my friend a min of £3k.

Both of these issues are making me really worry now.

I thought about maybe starting a DMP but exclude my current bank. However my current bank has the majority of my debt (£29k) meaning I would only be doing a DMP on the remaining debt, but also still servicing my banks debt. This would be a disaster, as I know that without having a clean break in the coming months I will be back where I am today.

time-4-a-new-start

worried1969 wrote: »

Hi time-4-a-new-start, just wanted to say i have just started on the DMP route with CCCS papers posted Thursday with with all creditor details, would be good to support each other (debt of £32k) so like you is the start of my journey. The support on here is great, i am just waiting and hoping now my creditors will accept my payments. Good luck and keep posting.

Hi worried1969!

Glad that someone is starting this at the same time as me. I would be deligthed to offer my support anyway I can to hopefully help both of us get through