Cannot Get on DMP because of PayDay Loans

Brogden_III

Hi All,
I am new on MSE but I have been lurking around the last few weeks as I have been going through this difficult period. Finally joined.

I have a load of credit card debts. Things have been getting out of hand and following the failure of an application for a second mortgage to pay everything off have been dithering.........

Finally got into action with CCCS, completed the Debt Remedy and submitted it. The problem is that I have payday loans and I didn't realise just how much these mess things up. I have been on the phone to the CCCS today for more than an hour! I have three payday loans for repayment on Friday from my debit card. It was my intention to try to avoid paying these on the payment date (IF I could....read those threads) for the reason that this would 'freeze' the situation (bar added interest / charges etc) and enable me to enter the DMP knowing exactly where the total debt figure stood and the amount of the payday loans would be included in the DMP as part of my overall debt.

If I mess around extending one / repaying one etc etc then CCCS would not have a precise debt figure for us to to work on and if I was (say) paying one off, extending another etc, I would effectively be active in new credit agreements which is of course not allowed. Also the cost of extension would mess up my expenditure forecast.

Has anybody had a similar experience? How did they overcome it? So many people entering DMP's surely have payday loans. I am so keen to start this DMP at the earliest opportunity but at the moment I can't see how I can. The guy at the CCCS said that payday loans did not usually figure in DMP's (because the payday loan companies were so impatient to get all their money back that they wouldn't play ball with CCCS with pro-rata payments etc.) To start the DMP would seem to involve me having to pay the lot back all in one go. I cannot do all of that this month, maybe not next month.

Any suggestions anyone? I curse these payday loans.

All the best

Brogden III

nottoolate

i'm sure i've seen quite a few people here include payday loans on dmps

try on the support thread?

Brogden_III

Thanks nottoolate!

I will take a look at support. Would I be right in saying that those payday loans included DMP's have defaulted and may be still with the payday loan company or maybe transferred to DCA's? Not sure you can include a live one in a DMP?

NorthernLas

Try looking at posts by user saltnvinegar like https://forums.moneysavingexpert.com/discussion/2735257=

If you do a advanced search of the DFW forum for user saltnvinegar you will find a one called 'feel my pain ...' which is this users story on what they did to resolve their payday loan issues

NorthernLas

I think the first issue you have is to stop the payday loan taking money from your account. Others have included payday loans in DMPs.

The strategy involves telling the bank your card has been stolen. Ideally, you need to have a basic bank account in place so that your money is safe from loan companies or banks you owe money to.

Brogden_III

Hi,

Are we saying then that I need to either (a) repay or (b) default on a payday loan before I can start a DMP?

As the payday loans are going to hit the bank on Friday this week it is too late for the 'parachute account approach.' I have a bank account agreed but am awaiting card and bank details in the next day or so and the deadline for switching my salary payment has past anyway.

I do not want to report my card lost or stolen as I will need it and I know this MAY NOT stop the collection. I couldn't do with that worry. If I have to extend I'll have to do that. I just want to get on with the DMP though and not sure I can at the moment.

winner12

You could set up your own DMP

Sparklyfairy

I agree with Winner - do your dmp on your own. Remember that CCCS & Payplan are charities, but they are funded by the banks......!

Yes you will default on your repayments - you'll be paying an amount less than you agreed when you agreed to the payday loans (or any other cc or loan you will include on a dmp). Read up on as much as possible on DMPs. You may even get a CCJ, BUT as long as you keep your creditors informed of your intentions & payments this should be very rare. HTH, SF

Just to add...yes, get a basic bank account with a bank you don't have credit with...this can be tricky because some are linked where you wouldn't expect, post on here who your debts are with & we'll try to help. Co op are rarely linked to other banks & have a very good basic bank account - call them & get one set up asap (also ask for a card reader when you apply too..) as it'll take a couple weeks to get everything.

Tixy

You should still be in time to save money being taken out on Friday from you current account.
Set up a new account as soon as you can, withdraw any money sitting in your existing account - or up to your overdraft limitd (you'll need to keep withdrawing anything else that goes in as soon as it goes in) PDL companies will often try to take funds every day once your are in arrears.

Once your money is safe then you should be able to do a DMP - certainly there are people on here who have PDLs in their CCCS and Payplan DMPs, in fact a number of people have reported that once they set up the DMP some of the pdl companies are the first to accept and freeze charges etc. I think the only problem is when PDL companies can still deduct money from your account so that is the main issue to address.

You say you are not in time to switch this month's salary payment - would work consider paying you by cheque just this month (say you've had problems with the bank or even had fraud on your account and so really need the money no to go in to that account if at all possible).