debt management plan, please read

shanikang

hi
I owe approx 8000 and i have just (today) agreed to a debt management plan to pay back 100 every month, am i doing the right thing or is there another way that you guys know.
I would appreciate any feedback

crazyguy

dont bother unless it is the charity one that does not charge a fee !

I was in one and then wrote to my creditors offering to pay them myself and was accepted !

shanikang

Hi thanks for that, they are going to charge me £35.00 per month.

could you please tell me which charity does this, and also did the creditors help you when you phoned.
sorry about this how did you get out of it.

judojub

You can arrange a DMP yourself. No need to pay anybody to do it unless you don't want the hassle of ringing all your creditors and trying to arrange agreements with them. A DMP is a good solution if you have little (ish) debt and if you can pay it off within a reasonable time. However, how long it takes to pay off all rather depends on your creditors and whether they play ball by freezing interest and such like. How long did the company tell you it would take to pay off?
Another possible solution might be a DRO. I don't know an awful lot about these but there is a thread on the Bankruptcy board. Might be worth taking a look at. Did you speak to anybody beforehand. CCCS, CAB, National Debtline? If not, it might be worth giving them a tinkle too.
Sorry I couldn't really help but keep searching the forum and you will find your answers!

judojub

Also, perhaps you could go over to the Debt Free Wannabe board and post up an SOA. I am sure some guys over there will take a look at it and see if there is anyway you can help yourself without having to go down the DMP route at all.

shanikang

Thank you so much, i havent tried anything to be honest, i just panicked when i realised that my debts were spiralling. they are ringing me back in 10 mins so i think after your brill advice i will try and go down one of those avenues first. thank you again :j

judojub

Always best to get some free advice first at least they can fill you on what your options are and ultimately decide what might be best for you in the long run. Best of luck x

crazyguy

shanikang wrote: »

Hi thanks for that, they are going to charge me £35.00 per month.

could you please tell me which charity does this, and also did the creditors help you when you phoned.
sorry about this how did you get out of it.

I wrote them all letters first and once they all agreed then went ahead and made a monthly payment to them all.

The £35.00 is a rip off, you can deal with this all your self.

I suggest you draft a letter and say that you are in financial difficulties and cannot for the time being make full payments to them, I wrote that if they would accept a payment from myseldf direct the actual fee that was not being paid will be divided up fairly by all my creditors and also as and when smaller ones are settled will increase the amounts to the outstanding debtors.

I also wrote in my letter that it would be in there best interest to accept a payment plan from myself as my only other options would be an IVA or going Bankrupt, they were all very good about it and accepted my offer straight away.

Am still in the process of clearing all my debts and have no real problems with them, they normaly write to you after 6 months to review your payment plan but all of mine are still fine with what they get from me and have been for nearly 2 years now.

Good Luck

GOLFER

crazyguy wrote: »

I wrote them all letters first and once they all agreed then went ahead and made a monthly payment to them all.

The £35.00 is a rip off, you can deal with this all your self.

I suggest you draft a letter and say that you are in financial difficulties and cannot for the time being make full payments to them, I wrote that if they would accept a payment from myseldf direct the actual fee that was not being paid will be divided up fairly by all my creditors and also as and when smaller ones are settled will increase the amounts to the outstanding debtors.

I also wrote in my letter that it would be in there best interest to accept a payment plan from myself as my only other options would be an IVA or going Bankrupt, they were all very good about it and accepted my offer straight away.

Am still in the process of clearing all my debts and have no real problems with them, they normaly write to you after 6 months to review your payment plan but all of mine are still fine with what they get from me and have been for nearly 2 years now.

Good Luck[/QUOT
Hi there

What sort of offer did you make to them?

How did it affect your credit file ?

Did you ask them to freeze interest and charges ? and what did they say.

thanks

crazyguy

GOLFER wrote: »

crazyguy wrote: »

I wrote them all letters first and once they all agreed then went ahead and made a monthly payment to them all.

The £35.00 is a rip off, you can deal with this all your self.

I suggest you draft a letter and say that you are in financial difficulties and cannot for the time being make full payments to them, I wrote that if they would accept a payment from myseldf direct the actual fee that was not being paid will be divided up fairly by all my creditors and also as and when smaller ones are settled will increase the amounts to the outstanding debtors.

I also wrote in my letter that it would be in there best interest to accept a payment plan from myself as my only other options would be an IVA or going Bankrupt, they were all very good about it and accepted my offer straight away.

Am still in the process of clearing all my debts and have no real problems with them, they normaly write to you after 6 months to review your payment plan but all of mine are still fine with what they get from me and have been for nearly 2 years now.

Good Luck[/QUOT
Hi there

What sort of offer did you make to them?

How did it affect your credit file ?

Did you ask them to freeze interest and charges ? and what did they say.

thanks

My credit file was trashed so I did not worry about that to much and as to what I offered my initial payments were at £450 £500.00 per month and now they are £75.00 per month so whilst it will take me longer to pay them off it is quite substantial saving from the figure I was paying.

As for freezing the interest, all these debt managment companys say they will get that frozen for you, total rubbish it never happens and as and when I have paid smaller debts then I go to the bigger amounts owed and look at the original figure owed and make an offer of approx 20-30% of that amount, normaly have to couter offer a couple of times but my best one so far was an amount of appox £5000.00 being settled for £1200.00 as a full and final settlement.

GOLFER

crazyguy wrote: »

GOLFER wrote: »

My credit file was trashed so I did not worry about that to much and as to what I offered my initial payments were at £450 £500.00 per month and now they are £75.00 per month so whilst it will take me longer to pay them off it is quite substantial saving from the figure I was paying.

As for freezing the interest, all these debt managment companys say they will get that frozen for you, total rubbish it never happens and as and when I have paid smaller debts then I go to the bigger amounts owed and look at the original figure owed and make an offer of approx 20-30% of that amount, normaly have to couter offer a couple of times but my best one so far was an amount of appox £5000.00 being settled for £1200.00 as a full and final settlement.

So how does your debt decrease if your making smaller payments but they are still charging interest.

eg say i owe £7000 on a cc min payment £110 int £100 i offer to pay £50 then my balance will go up by £60 each month. so after 1 year i would owe £7720.00