DMP & Mutual Support Thread - Part 8

Tigsmom

sunnyface wrote: »

Also just received a flurry of defaults which is really annoying - I thought I would get these at the beginning i.e. last year, but no - I really hope this is the last of them.
This now means 6 years from now of not being able to get a mortgage doesn't it?
After 6 years (so 2018), does this mean my file will be clean again?
(question purely hypothetical as I will still be on my DMP by then anyway)

This may seem like a daft newbie question but this post made me think. If my creditors don't issue defaults does it mean my credit file will be clean once I've paid my debts off instead of waiting 6 years? I don't really understand how the default thing works. I've read that some people prefer to get defaulted early on so that effectively is the start date of the 6 year wait, yet others don't get defaulted for some time after.:huh:

Hopelessly_Hopeful

Hi Folks

Will try to explain the credit reference thing.

You can only be defaulted once on an account. It's upto the creditor when they apply it, they may not apply it until the last year of your DMP! Defaults last 6 years, so the earlier you get them the sooner the clock starts ticking.

Lets take example that someone enters a 4 year DMP in 2010 and has a default also in 2010. They will hopefully have a DFD of 2014 but will have a default on their record until 2016.

Say someone enters a 8 year DMP in 2010 and has a default also in 2010. They will hopefully have a DFD of 2018 but the default will only be on their record until 2016.

Lets take example that someone enters a 4 year DMP in 2010 and does not get a default until 2013 They will hopefully have a DFD of 2014 but will have a default on their record until 2019.

The challenge is most people have numerous accounts, some defaulted, some not. What I consider more unfair than defaults are things like arrangements to pay or 'AP' . Is this AP is logged each month until the end of your DMP then you still have 6 years after the end of it before your credit report becomes clean.

If you are looking forward to a 'clean' credit record you want it unblemished for 6 years. It doesn't mean you can't get a mortgage or other credit in this time, just that the chances of being accepted or lower and you may not be offered attractive rates of interest!

This is why people often say it is good to have a default because then you know where you are! Te lesson for all is please check your credit records, you can do it for free at noddle.

HTH

HHx

emmiloam

Time_to_face_the_music wrote: »

Well done emmiloam :T

I freely admit that we overpay interest charging creditors while on a CCCS DMP and CCCS must know we do it because we change the balances online. They actually told SAAC that it was ok to do this, I can't find her post to reference this but hopefully she will come along and confirm this. I have also checked our DMP arrangement and there is no mention of this not being allowed.

Did you tell CCCS you were intending to do it? Maybe if they realise we are, it will be the push we need to go it alone :think:

We had 90% already made our minds up to go alone anyway, the CCCS just gave us that extra little push we needed to realise it was the right thing for us (in our circumstances) to do.

Basically Halifax CC (bal approx. £3500) were charging us approx £70 per month interest, and being paid £120 by CCCS. Santander (bal £340) are charging no interest but are being paid £100 per month by CCCS. After speaking to Santander they agreed a minimum monthly payment of £50 interest free, so that straightaway released £50 that we could send to Halifax. We're not being charged interest on our other 2 creditors either, so we've come up with similar arrangements with them too. It just means that the largest creditor, and the only one charging interest is now getting a huge bulk of our monthly dmp budget, which in turn will mean the interest reduces each month along with the balance.

I hope all of my waffle makes some sense to you :rotfl:

E

Time_to_face_the_music

Makes perfect sense and is extremely useful.

I would be concerned that our creditors would not accept a payment from us that was lower than that offered by CCCS, but this was not a problem for you?

Thanks very much emmiloam :T

sunnyface

Hopelessly_Hopeful wrote: »

Hi Folks

Will try to explain the credit reference thing.

You can only be defaulted once on an account. It's upto the creditor when they apply it, they may not apply it until the last year of your DMP! Defaults last 6 years, so the earlier you get them the sooner the clock starts ticking.

Lets take example that someone enters a 4 year DMP in 2010 and has a default also in 2010. They will hopefully have a DFD of 2014 but will have a default on their record until 2016.

Say someone enters a 8 year DMP in 2010 and has a default also in 2010. They will hopefully have a DFD of 2018 but the default will only be on their record until 2016.

Lets take example that someone enters a 4 year DMP in 2010 and does not get a default until 2013 They will hopefully have a DFD of 2014 but will have a default on their record until 2019.

The challenge is most people have numerous accounts, some defaulted, some not. What I consider more unfair than defaults are things like arrangements to pay or 'AP' . Is this AP is logged each month until the end of your DMP then you still have 6 years after the end of it before your credit report becomes clean.

If you are looking forward to a 'clean' credit record you want it unblemished for 6 years. It doesn't mean you can't get a mortgage or other credit in this time, just that the chances of being accepted or lower and you may not be offered attractive rates of interest!

This is why people often say it is good to have a default because then you know where you are! Te lesson for all is please check your credit records, you can do it for free at noddle.

HTH

HHx

Thank you for this very informative and helpful post.
So the defaults will all be gone in 6 years and the companies who apply defaults cannot then register APs also?
Where is the best place to check my credit for free?
I'm fairly sure I have a couple who have not defaulted - these are likely to be the problems then.
Wouldn't have thought this - and it is definitely unfair that these APs can keep going on every month and then take a further 6 years to come off
Now I'm hoping they all default me instead :rotfl:

Gazza1964

Hi,

Sorry for being a bit thick but I am just sending out my inital letters with the token payments - who do I make the postal orders out to - for example MBNA - do I just put MBNA on the PO

Time_to_face_the_music

Gazza1964 wrote: »

Hi,

Sorry for being a bit thick but I am just sending out my inital letters with the token payments - who do I make the postal orders out to - for example MBNA - do I just put MBNA on the PO

Have you got any old statements Gazza? It generally gives details on the back for who cheques/POs should be made out to, and also a mailing address.

Gazza1964

Good thinking - I will have a look.

sickasachip13

Hi all

On the additional payments - just to clarify, we do make occasional additional payments to a creditor who charges us % but we don't regularly make an additional payment. For example, when I sold my old banger (no, not Mr SAAC), for a couple of hundred quid I asked CCCS advisor whether I should make an additional payment across all the creditors. They suggested I used it for a F&F attempt or that I put it towards an additional payment to one creditor. So, we've done this a few times, never that much again, just an extra fiver here and there when we're sold stuff on ebay / amazon. I then adjust it on the CCCS online system.

SAAC

Tigsmom

Hopelessly_Hopeful wrote: »

please check your credit records, you can do it for free at noddle.

HTH

HHx

Wow, I didn't know that, thanks.

Trouble is I've just done it and it's come back with a 4/5 rating which is good. Unfortunately I've just got all the paperwork for the DMP and now I'm confused! I'm about to blow a good credit rating but I'm not sure it's much use to me anyway as I get turned down for 0% cc's due to low wages! I will get DH to check his (he's not been as good as me in the past but has a better wage). Is it possible to get interest rates reduced without it affecting your rating?