A Wise Move or not? (DMP)

Alzy_2

Hi Guys,

I have recently switched over my DMP with Gregory Pennington to Money Expert (Immediate Financcal) and will be cancelling payments to GP from the end of this month.

My total un-secured debt with GP at the moment is around 11k. Now, ME seem to think they can reduce that to circa 7K and halve the repayment time.

The only thing that concerns me is that at present GP have negotiated a price that my creditors are happy with, however ME are going to be sending £1 payemts to all creditors, monthly, with the follow up of whatever monies I pay monthly to be held in an account and used to clear individual debt in one lump.

This seems to be an aggresive way of dealing with my situation but to more than halve the term and save me over 4k, surely it must be worth it??

Can anyone advise?

Many Thanks

getmore4less

What are the people charging you?

Tixy

I would switch to a free DMP with one of the charities who will charge you no fees.

The problem with the ME approach is that your creditors are not going to be happy with £1 a month, especially when they realise you can afford more (after all you have been paying the more before, and they'll want to see an income & expenditure account). Your creditors may well decide to take you to court and obtain CCJs against you. I'd imagine a judge would take a very dim view of this approach.

The other issue you might well have, is that similar DMP companies with 'creative' ways of running a DMP have gone bust/disappeared. If that should happen your pot of money held by them might be very difficult to get back.

Stick to a proper recognised method of paying back what you can afford a month, and use a charity, which as there will be no fees will also mean your debts should be cleared quiker than the GP DMP.

bargainbetty

Echoing Tixy, you stand a very good chance of ending up in court, or losing your money. The only circumstances under which a creditor will accept £1 per month is if you genuinely cannot afford more. They know you can, and will come after you.

ME are being grossly irresponsible in suggesting that this course of action would get you cheaper settlements. Frankly, if you dropped your repayments to me to £1 for a year and then came asking for a lump sum discount, I'd slap you with court papers so hard you would spin for a week. And so will your creditors - they will have proof that you withheld monies due to them, and broke your agreement to pay them a fair share of your available income.

Go to CAB, CCCS or Payplan. They are free and you will be able to pay things off faster because you won't be paying DMP fees on top of everything.

Good luck, but seriously, don't touch this with a bargepole.

Alzy_2

bargainbetty wrote: »

Echoing Tixy, you stand a very good chance of ending up in court, or losing your money. The only circumstances under which a creditor will accept £1 per month is if you genuinely cannot afford more. They know you can, and will come after you.

ME are being grossly irresponsible in suggesting that this course of action would get you cheaper settlements. Frankly, if you dropped your repayments to me to £1 for a year and then came asking for a lump sum discount, I'd slap you with court papers so hard you would spin for a week. And so will your creditors - they will have proof that you withheld monies due to them, and broke your agreement to pay them a fair share of your available income.

Go to CAB, CCCS or Payplan. They are free and you will be able to pay things off faster because you won't be paying DMP fees on top of everything.

Good luck, but seriously, don't touch this with a bargepole.

Decision made.

Many Thanks

Alzy_2

Thank you for that everyone.

I have now cancelled it. Does anybody have preferences over the "charity" organisations? Or are they all much of a muchness?

Thanks again

Tixy

IMPORTANT - Where to seek professional impartial advice about your debts.

CCCS are officially recommended on MSE and will run a full DMP for you, and run more than any other charity.
Most CABS will not run a DMP for you, they will either point you to CCCS or Payplan or help you set up your own DMP. CAB in some areas I think will still run a full DMP.
Payplan is not a charity but does run a DMP for free and whilst not officially recommended by MSE most people on here who use them are happy with them. (A few people say that they try to sell you other items, insurance etc but if you are happy to say no to those types of things then that shouldn't be an issue.
Christians against poverty are another charity who will help and run a DMP, they can be particularly handy for someone who struggles on the phone and would like someone to come out and visit them (you don't have to be Christian or even religious for them to help you)

There are of course isolated instances of all where people are unhappy with the service they have received - I guess thats inevitable.

fatbelly

Tixy wrote: »

Most CABS will not run a DMP for you, they will either point you to CCCS or Payplan or help you set up your own DMP. CAB in some areas I think will still run a full DMP..

Hi

...with my CAB hat on...

We will help people set up what is effectively a self-managed dmp but we can't handle cash so CCCS/Payplan have the advantage if people want a 'one payment per month' approach.

We also now have a formal relationship with CCCS - they are our preferred partners or something like that. It's a pilot project at present so not all bureaus are in it. Press release