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On DMP and stupidly taken on more credit..so scared..

Hi,

I'm (single working mum with 2 kids) currently in a DMP with CCCS and have been for 15 months. Stupidly in my haste to pay off my debts and try to encourage my creditors to stop interest I set my budget way too tight. It worked and all 6 stopped interest almost straight away which was great but the downside of setting my budget so tight was that I struggled so badly and got behind with my rent. In a moment of sheer depression and panic after receiving a letter stating they could take posession of my council flat if I didn't pay up I stupidly took out a Payday loan to pay it. This in turn has spiralled out of control and I now owe £1500 :(

I know I was stupid but I took it out as I was due £1000 inheritance and was confident I'd be able to pay it off but then found out that the person had been claiming benefit which they weren't entitled too and my inheritance was swallowed up.

I really don't know which way to turn. I haven't slept all night and feel so sick and scared and utterly exhausted.

I know the sensible thing to do would have been to contact CCCS and reduce my payments but I was so scared that this would upset my creditors and they would start adding interest again.

Really don't know what to do :( just feeling like running away from everything or jumping off a cliff.. I'm sure the CCCS will stop my DMP and the interest will all go on and I'll be back to square one.

God I'm so stupid :mad:

x

Comments

  • Ouch.

    Have a look around the house and see what you can sell. Wiis, X-box, stereo, collectibles, second tv etc. Pasta maker you never use etc. (:o I am guilty of that one!)

    Yes, I mean the kids stuff too. Better that than their Mum suicidal!
    Get them involved too.

    Can you take a second job? Or make money via Avon etc.?

    Post an SOA too of course, as there might be some cutbacks that can be suggested.
  • Tixy
    Tixy Posts: 31,455 Forumite
    edited 5 June 2011 pm30 6:28PM
    Hi

    You know you have made a mistake but I suspect you probably cannot repay this amount of debt by cutbacks / selling things etc.

    I can think of 3 options.

    First contact CCCS and explain what you have done and ask if they will allow you to add the debt to your DMP (you might even want to address the issue first on the CCCS thread anonymously to see if its likely they will carry it on).
    If they say no then you could either see if Payplan would run a DMP for you including the new debts. If they won't agree to take on your DMP then your third option would be to take on running your DMP yourself.
    A lot of people do do this and whilst its not as easy as having your DMP run for you it is an option. If you do this you'll need to redo a budget at a more realistic level and you'll need to recalc the payments to all creditors to include the new ones. CCCS or national debtline could provide you with template letters and the people here will help you set a budget. Your existing DMP creditors obviously won't be thrilled at getting lower payments than before but if you can prove you are paying all you can afford then they should accept it and should keep interest frozen.

    Whatever you do you'll need to tell CCCS as you cannot keep servicing the payday loans.
    A smile enriches those who receive without making poorer those who give
    or "It costs nowt to be nice"
  • Thank you both for replying :). This forum is fantastic. One of the hardest things about being in debt is doing it alone as I haven't told anyone.

    Dharma Bunny - I have actually sorted some clothes out and put them on Ebay today but not holding out much hope of making much, think I'll be lucky to cover my fees if they sell. I wish I had other things to sell, I couldn't sell anything of my kids as they are miserable enough that we never do anything and never have anything to look forward to :(

    Tixy - Thank you for your fab advice. Yes your are right anything I can sell wouldn't even make a dent and as I've got into this mess trying to pay off as much to CCCS as I could so it's not possible to tweak my budget any more.
    I think I'm just going to have to come clean to them. Have spent the whole day in floods of tears and thought I was having a panic attack at one point :(. Not sure if I'm more scared of admitting all to the CCCS or defaulting on my Payday loans..from what I've read on this forum they seem really ruthless. Not sure I feel strong enough to go it alone but if it comes to that I have no choice.

    Am kicking myself so hard for getting myself in this mess.
  • thechippy
    thechippy Posts: 1,938 Forumite
    Hiya,

    Stop worrying........;)
    Take Tixy's advice and keep in touch on here as things develop.
    You'll be fine........:D
    Happiness, is a Kebab called Doner.....:heart2::heart2:
  • chuckley
    chuckley Posts: 4,405 Forumite
    Part of the Furniture
    dont ever give a damn about creditors. most of them do not care when ur in trouble. and many will tell you to use 'another persons credit card' to pay it off, iw, relative in the household. therefore make things harder. ask for CCA's even if u know u owe the money, most wont be able to produce one.

    contact CCCS and just be honest, what they do after that is up to them, go it alone or find another.

    at a time when i was not being paid i didnt pay ANY debt at all not even £1 for a couple months. i let the letters fly in, I couldnt reply as i had NO money and was eating 10p noodles for lunch. it was either my health or them being paid 10p just to shut them up.

    Once i regained control and they realised I would pay when I had it, they stopped calling writing and I started paying when i FINALLY got paid!

    I think you need to take a step back and let them run up the interest and threats and all sorts. Just send them a letter stating ABC of what you can do and when.

    dont panic as you'll just let them scare you into another PDL application. ignore ANY phone calls (not answered any in over a year).

    with the PDL loan - report the card 'lost' and if they set up any DD's cancel (check it daily) and let them write to u saying u owe blah blah and if they dont accept a payment plan you can afford, let them DCA it, who'll accept whatever u say.... with many tho it takes them up to a year to DCA it, if at all.

    just learn from this and dont under budget.
  • Mr_Max
    Mr_Max Posts: 43 Forumite
    Hi there.

    I used to work for a Debt Management Company. The best thing I can recommend is to contact them. You're not the first person to have taken out credit while on a DMP and you are certainly not going to be the last. By putting it off, you'll make it worse. Quite simply, you'll not be able to pay the payments, and the CCCS will not have an explanation when the creditors call them to ask why.

    Just be honest. You should be able to put the payday loan onto the list of creditors as long as you've made at least three payments to them (that's a very general rule, not set-in-stone and depends on the creditor).

    Finally.. (I know it's easy for me to say) don't worry. This happens often, and you're not the first :)
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