DMP questions....

postingalwaysposting

sorry all but some peoples sigs/statements are confusing me... some people say that they have to do a 40/58/63 year plan on their dmp... but surely if they are already 30 (for example) that means they will be 70/88/93 when the plan finishes (ie into state pension or (and i hope not) dead) so how does a dmp actually work.... because surely thats impossible

CLAPTON

well it goes like this
suppose you owe £12,000

and you can only afford to pay £50 per month i.e. £600 (50x12) per year
then it will take =12,000/600 = 20 years to pay the debt off.

of course in practice many things may happen that means it doesn't actually happen like this.

in my opinion anything over 10 years is unreasonable but that's a different debate.

postingalwaysposting

ummm clapton that has helped a little but is it worth it

moxie_2

Once you are on a DMP it is reviewed annually. So if your circumstances change, for example you get a pay rise or promotion, your payments will also change. My debt free date is 2014, but once my daughter has finished uni I will have more to throw at the debts, so hope to bring it forward. But my DMP is only(!) for 7 years. I can't imagine anything over 10 years, as Clapton said. But I suppose it must be the best option for some people, who don't want to go bankrupt or have enough disposable income for an IVA.

Mike_St_Helens

Its a good thought you konow... Bankruptcy is a max of 6 years if yur an angel......

jillie1974

it was explained to me that a DMP is a way to get you back on track and that after your annual reviews and increases in income etc may mean that you can come off the plan...

livinginhope

Evening PAP,it is worth doing a very long term DMP if you have too much to lose,if we go bankrupt we would definately lose our house,we couldn't afford to rent and wouldn't be able to rent a suitable house anyway! we do not have enough money for an IVA so the DMP is our best solution.Although ours has started with a 58 year timespan,it probably won't last that long,things happen and at some point we should be able to pay more.
Hope you aren't too confused
LIH

MW84

what happens if your income decreases or infact you have no income? say you went to Uni

spud30

Thanks for that LiH, I was beginning to think I was doing the wrong thing here !!!

I am also on a very long DMP, but would hate to lose our home by going bankrupt.

Our circumstances are improving, and we are hoping to knock many more years of our DFD.

Slowly but surely ehh .

livinginhope

MW84 wrote:

what happens if your income decreases or infact you have no income? say you went to Uni

You would reduce payments on your DMP accordingly.This actually happened to us earlier last year,DH lost his job,but we still managed to keep to our regular payments,if he had not have found a job so quickly,then we would have had to claim benefits,which we would have used to keep up payments,needs must!
LIH