Please help...so confused

scared-sick

I have a lot of debts which I have been struggling to pay and have recently come ocross this site which is full of great advice.

I am looking at different options, but my question is: if I ring my credit card company up and ask them to freeze the interest, but continue to make minimum payments (as opposed to reduced payments) will they immediately put this as a default on my credit file?

I am basically trying to see if I can reduce some of the larger debts without it having too much of an adverse affect on my credit rating.

villarenter30

From my experience and as I say its just what I have been through they will not budge on the interest until they believe or you prove you cannot pay - until you start missing payments they will see it as if they offer you a discounted rate then everybody will want one - they will only budge when their payments are in jeopardy and bear in mind you have to send in soas and sometimes proof/bank statements etc and then they have to issue the default wait 21 days etc so even then it take a month or do before they will budge on interest rate and not all creditors will freeze interest then, apparantly they are not legally obliged to buy yo can complain to the ombudsman if they are being unreasonable

scared-sick

Thanks for the response.

I am trying to sort out the problems before they happen, ie sort out a payment scheme before I actually start missing payments, you would think they would see it as the responsible thing to do.

I have spoken to the debt helpline and they ran through options but I was very confused and still not fully aware of the impact each option will have on me. Might try CAB to see if I can get a face to face appointment.

I am basically so scared to do anything at the minute incase I make the wrong decision and I dont know which way to turn.

I feel so embarrassed talking to anyone about money problems and it was very tough for me to make the phone call to debtline, even friends and family dont know.

I think an IVA might be my best option but I feel like I got myself into this mess, I should get myself out of it.

villarenter30

I know what you are saying abut trying to sort it before there are any problems and I myself thought exactly the same as you and thought if I can keep up the payemnts and they drop the interest even one or two percent it will help - but the card companies didn't want to know - I have only got interest frozen by instigating a dmp myself and thats not all creditors - dmp's are great - I think i battled on for two years when really if I'd bitten the bullet before probably could have saved myslelf thousands in interest - I was being late with payments but just managing to make them and all the creditors did was say thanks theres a late fee ann overlimit fee and some interest... see you same time next month.... ooo and we won't help until you really can't pay - cccs and payplan give great advice buy you can glean it all from here and do it yourself - you will get it sorted - good luck with it all

scared-sick

So if you do a DMP yourself you dont have to put all your creditors on it? So small debts I can just continue as normal and only try and reduce the large ones?
Also I have been told that if you do a DMP yourself, I will have to negotiate with the creditors every 6 months, whereas if a company do it, it is for the remainder of the debt. Do you know if this is right?

I am exactly like you and am thinking about struggling on, but to be honest I am only keeping my head above water by taking on a second job and working 7 days a week which is going to be unsustainable for the long term.

Is there a reason you chose a DMP as opposed to an IVA?

happy_bunny_2

even if they agree to accept lower payments or freeze interest, likely they will add arrears to your credit file (if you pay below minimum) and may add an arrangement to pay if they freeze interest for a while.

Ideally, you don't want either of these.

As others have said, they won't budge on interest until you demonstrate you can't meet the payments, and at that point your credit file will be hit.

findingmyownway

Have you been making the payments ok up to now? Perhaps if you post an SOA (see sticky thread at the top of the board) then you'll get some advice where you can improve your situation without defaulting.

headachesrus

scared-sick wrote: »

So if you do a DMP yourself you dont have to put all your creditors on it? So small debts I can just continue as normal and only try and reduce the large ones?
Also I have been told that if you do a DMP yourself, I will have to negotiate with the creditors every 6 months, whereas if a company do it, it is for the remainder of the debt. Do you know if this is right?

I am exactly like you and am thinking about struggling on, but to be honest I am only keeping my head above water by taking on a second job and working 7 days a week which is going to be unsustainable for the long term.

Is there a reason you chose a DMP as opposed to an IVA?

I have a self maintained DMP with 4 creditors, they contact me about once a year to see if my circumstances have changed, and usually squeeze a little more out of me each time. It has certainly saved my sanity.

I think with an IVA, it is a much more official thing, and if you have property for example, which I have, they can ask you to sell it at the end of the term, or remortgage to release some equity to give to the creditors.

It may be worth your while to drop to £1 a month payments for a couple of months, to encourage them accepting a dmp, and freezing the interest, they don't have to do this though. This will also result in a flurry of phone calls off them, something to be aware of if other people answer your phone calls.

MrsTinks

Firstly - you are no more likely to get interest frozen by using a "company" than doing it yourself - you MAY have slightly better success by going through one of the free debt charities however The creditors are very used to dealing with them and know what to expect etc.
And no you don't negotiate a 0% for the remainder of the debt just by going through a company/charity. The stopping or reducing interest is ENTIRELY at the good will of your creditors - please make sure you realise that

Dangers to not including all your creditors in your DMP is that if the others find out you have been giving preference to some they may decide to start playing hardball - and rightly so.
No debt charity will let you pay only some of your creditors through a DMP and not others... As for effect on your credit file... I think if you default on 3 then it won't make much difference to defaulting 6 in all honesty...

Verbatim

And please don't use a fee charging company when you can get the same service, or as many would say, a much better one, for free with CCCS or another charity where ALL of the money you pay goes to your debts.

del2210

My advice if you are really worried go to the CCCS as they will put all your debts excluding Mortgage/Rent and hp,s in one easy sum pm.I had £29000 debt 2003 and managed to be debt free 2010.