Freezing Interest

chefsatwork

Hi there,

I'm in debt around £12,000 , i would like to be debt free..... so i came across a debt management agency and was wondering if anyone could advice me on it... i think is called the debt people.. anyway im not sure of what they mean by freezing the interest rates and they will act on my behave for me and talk to my creditors and so on, sort of like agree with the various banks i owe money to.... and consolodate my credits in one monthly payment

1. would this mean that i will be black listed for life in the credit world? even after i sort out my debt?
2. or in future would it be difficult for me to get loan , morgage and etc?

im a newbie to this website and not sure weather i post it in the right Thread..

Alex

Nelle_2

I would suggest you take a look at the non profit making companies that Martin suggests on his homepage.

Good Luck

CLAPTON

debt people will charge you fees for managing your debts, go to CCCS or Payplan who will charge nothing.

without seeing your SOA its not possible to give any real advice but if you would like to post the general format is

An SOA Statement of Affairs

a. list of income
b. a detailed list of spending (include mortgage and secured debt but exclude unsecured debt)
c. a total of spending as above
d. now you can see how much you have to pay debt monthly by forming income minus spending
e. a list of unsecured debts
i.e. debt amount, minimum monthly debt repayment, APR
f. a total of unsecured debt and of monthly unsecured debt repayment
also say if you rent or buying , if so how much is the house worth and how much the mortgage, also your general situation: partner, children, working etc.

chefsatwork

clapton, i will submit my SOA when i get back

p/s my credit rating is very low i apply for 2 creditcard company to get a balance transfer but got rejected last 2 weeks?

nelle, what u mean by non profit companies,(pls elaborate) this company where i called for advice said is free, is called "the debt people" heard of it... https://www.thedebtpeople.com,... but i guess nothing is free in this world...

anyway when they say freeze my credit card interest rates so i pay off a sum monthly..... what does it mean when they say freeze the interest rates and talked to my credit card company.... ???i honestly do not know how this work?

thanks for advice in advance...

CLAPTON

the situation is basically this ..if a DMP is appropriate then what happens is that based on your SOA you work out how much you can afford to pay each month for your debts.

then you work out a prorata amount for each creditor (i.e. large creditors get paid more than small creditors). then you write to them explaining the situation saying what you can affford and asking them to freeze interest and charges.

Obviously they dont like this and will in general default your a/c. this will mean your credit rating is trashed for 6 years.

now this can happen is three ways

a. you can do it yourself

b. you can involve debt people ... they will deduct their fee from your monthly payment so there is less money for your creditors and so the debts take longer to pay off (they take typically £50/60 per month but ask them)

c. use CCCS or Payplan who will do it all for free and so all your monthly payment goes to your creditors and so the debt gets paid back more quickly. Also because your creditors know that CCCS/Payplan dont charge they are more likely to agree the payment plan than they will with a fee charging company.

moxie_2

I've had a look at their website and I'm not sure their information is correct. They say (in their FAQs): ;What are Debt Management Schemes?
Some people in debt choose this option. With such a scheme your debts are established in full and a payment plan is structured. However the debt that you owe will continue to grow as interest will be charged on the amount outstanding.'
I'm on a DMP with Payplan, a not for profit organisation, and most of the interest is frozen and my debt has gone down a lot!
Don't pay for this company's services when you can get a better service from Payplan or CCCS.