DMP (debt management plan)- your experience.

JBsplit

Oh one other thing.
How do companys treat you with 'new debt' i mean if i do a balance transfer in month one and them go for a DMP in month two. is that bad/worse than a long standing account.??

mophead

How do companys treat you with 'new debt' i mean if i do a balance transfer in month one and them go for a DMP in month two. is that bad/worse than a long standing account.??

This was the problem i had with capital one i had done a balance transfer only a couple of months earlier whe i was doing a hell of a lot of juggling.

Let's put it this way they were none too pleased.

misscutiepie1984

hi

I went on a DMP when i got to the stage where i was paying the minmum payment to one card then when that was cleared using that money to pay another card and so on between my 5 cards!!!! couldn't afford food or electric overdraft was at 2k as well so was stuffed had to give up my flat as well

Now i have not used credit in over a year and if i want something i pay with cash and i apprecate things a lot more becasue of it.

At the end of the day you cant let the comanies intimdate you because if you cant afford it you cant afford it simple as, you should worry about having a roof over ya head and food in your tummy before given a penny to your creditors.

There should be no reasong not to meet your DMP unless something major happens cos most things are factored in but they can let you have payment breaks if you need them.

as for advice GO FOR IT!!!!

Kazonline

Just a quick note to say a HUGE thank you again to everyone who has contirbuted to this thread. I hope no one minds, but I've added some of the new questions to my original post so that if anyone else posts about their own experiences but don't have time to read the entire thread they will still see the other questions.
Hope it helps
Kaz x

Jolinar

We've been on a DMP for over a year and half now through CCCS.

Main reason for the DMP was we had run out options, peter and paul were well and truly robbed but at the time we had not missed any payments and contacted CCCS before we got into trouble.

The main problems we had/have periodically are phone calls from creditors, Lloyds and MBNA are the worst, Lloyds because they call at really odd times despite being asked not to, although this has stopped now. MBNA because of the low tactics they use, like threatening to call at work, send someone around but of course they never do. Our initial concerns were that a charging order would be placed on the house, so far this has not happened, I checked my credit file last month, none of my creditors have defaulted me so far which I find surprising as I thought this was the first thing they would do.

The best creditors have been Northern Rock and HFC, although Northern Rock did add a couple of grand by way of interest to the total amount owed in return for reduced payments which is their perogative under the credit agreement signed. These two have been the easiest to deal with.

After a recent pay rise I increased my payments to all my creditors, Lloyds have recently started adding back interest and charges after freezing them for a year. According to CCCS Lloyds have started operating to the letter of the credit agreements despite their repeated requests not to.

I would say to anyone think carefully before doing it, it's not an easy option as some would have us believe, although in a lot of cases interest is frozen in ours it's not been and eventually we will pay back everything just over a slightly longer period. So it's not a get out to pay less. Not that I'm complaining for the first time in my life I've learnt to budget properly and I'm confident that I can cope now.

Kazonline

Jolinar wrote:

, although Northern Rock did add a couple of grand by way of interest to the total amount owed in return for reduced payments which is their perogative under the credit agreement signed.
....

I would say to anyone think carefully before doing it, it's not an easy option as some would have us believe, although in a lot of cases interest is frozen in ours it's not been and eventually we will pay back everything just over a slightly longer period. So it's not a get out to pay less. Not that I'm complaining for the first time in my life I've learnt to budget properly and I'm confident that I can cope now.

Thank you Jolinar - I think it's really important to be aware of the donwsides and cases where things haven't gone to plan before taking the plunge. When your prepared for the worst there can be no nasty suprises - only pleasant ones! I highlighted the one part because I think it's very important to remember this - I think we only tend to hear of the cases where the companies freeze/drastically reduce the interest.
When you say that Nothern Rock were able to add a couple of grand by way of interest under the credit agreement what do you mean? Was it a loan or is there something in the small print of CC's, or is it a credit agreement you do when you go down the DMP route? Sorry if I'm being a bit dim:o
Kaz x

Jolinar

Kazonline wrote:

When you say that Nothern Rock were able to add a couple of grand by way of interest under the credit agreement what do you mean? Was it a loan or is there something in the small print of CC's, or is it a credit agreement you do when you go down the DMP route? Sorry if I'm being a bit dim:o
Kaz x

No problems I hope my experience can help someone on here.

You're not dim

To try and explain the interest added on... I took out a loan with Northern Rock. The way I understand it as it was explained to me is basically the credit agreement I originally signed is still in force even though I'm in a DMP agreement with them. So under the credit agreement they are entitled to add on the interest up front that I would have paid had I stuck to the original payments. It's just a slightly different way of approaching the repayment of the loan and at the end of it all NR get all the money they are owed it will just take slightly longer. I suppose it's a little like restructuring the repayments rather than having the interest waived?

HTH

Kazonline

Jolinar wrote:

You're not dim

You're too kind - but I am a true blonde!:p

Thanks for explaining Jolinar - I understand now (I think) It's because it was a loan as opposed to a credit card? Have the CCCS given any indication as to why the companies didn't reduce/freeze the interest with you, or do you have any ideas why yourself?

Sorry to bombard you with questions, hope you don't mind

Kaz x

Jolinar

Kazonline wrote:

You're too kind - but I am a true blonde!:p

Thanks for explaining Jolinar - I understand now (I think) It's because it was a loan as opposed to a credit card? Have the CCCS given any indication as to why the companies didn't reduce/freeze the interest with you, or do you have any ideas why yourself?

Sorry to bombard you with questions, hope you don't mind

Kaz x

I don't mind at all

Well with Lloyds all I can gather from CCCS is it's a become their policy to reclaim what they call bad debt, with more and more folks going down the DMP/IVA route I'm guessing they are losing far more money than they perhaps would have a few years ago and so are applying charges to the letter of the credit agreement where they can.

With Northern Rock I had the impression that they used to go for charging orders but I'm guessing again that this costs them money to do and it's probably easier for them again to apply interest to the whole loan and then wait it out for the money to be repaid.

Bottom line is it will probably take me a little longer to repay it all but at least I can see that in 2010 I should be debt free which is all that matters to me