advice needed (and q's re dmp)

minipenny_2

ok here goes ive been writing this post for about 3 weeks but too afraid/embarrassed/ashamed to admit

we're struggling to repay our debt. we havent missed any payments yet but thats a possibility.
due to a job loss things went a bit downhill and now our income is a lot less - also due to the fact we recently had baby 2 so cant afford childcare for both (£400 a week in our area) I work full time and my oh works part time at the weekends and has our kids in the week. we are both looking (and applying left right and centre) for 2nd jobs.
I went to cccs on the advice on this site and they offered me a dmp. Now I just want some advice before I commit to this
as soon as we get 2nd job's we'll be back on track we're only short £100-£400 per month so I figure its doable. so really its just the next 3 months we cant repay full amounts (also a loan we got finishes in june so that £220 can be put straight towards the rest and we're going to sell our car in a couple of weeks)
we want to move house in a year to 18 months we cant get a mortgage at the moment because of how much we owe vs what they say is a low income.
will having a dmp stop me being able to get a mortgage? can I go on a dmp and then come off it in a few months/year when the situation is better? I dont want to commit for the space of 2 months if it means I wont be able to get another mortgage for 5 years.

So sorry for the rambling......I cant sleep because Im so worried about this and my head hurts trying to figure out whats best. I dont want to make matters worse.

rising_from_the_ashes

Hi minipenny, sorry to hear things are tough.

I'm not a "DMP expert" in any way and someone more knowledgeablle will be along shortly but have made a couple of comments... (ps - do not be ashamed...)

minipenny wrote: »

will having a dmp stop me being able to get a mortgage? can I go on a dmp and then come off it in a few months/year when the situation is better? I dont want to commit for the space of 2 months if it means I wont be able to get another mortgage for 5 years.

AFAIK, it's fine to go on a DMP and come off it if your financial situation improves but tbh it will already have affected your credit file so may not be worth doing so.

Mortgage - it could stop you getting a mortgage mainly as your creditors are likely to issue a default once the DMPs up and running (as you've not stuck to the credit agreement).

These will sit on your credit file for 6 years and affect your ability to get credit. Note: you cannot take out new credit whilst on a DMP so you would def have had to leave it before applying for anything else


If it seems to be a temp shortfall, have you tried speaking to any of your creditors and seeing if they will accept lower payments for say 6 months (until the car loan is paid off)? It might be worth a try - but find out whether they'd issue defaults for this or not / what will show on your credit file (eg late payments, arrears etc).

Standingtall

Hi Minipenny. I am afraid I can only say that it is unlikely you will get a mortgage on a DMP but that it is equally unlikely ou will get one if you only make token payments for a couple of months. Sorry.

What strikes me is that you are relying on something that hasn't happened - the second job situation. Plus, even if you do get these jobs, how long could you sustain that amount of work for?

Have you considered simply accepting that you should forget about moving for the next 6 years or so and concentrate on paying the debts at a manageable rate, living you some money and time left over to enjoy your family time?

I do think that if such a decision is possible, you would find the relief of having chosen that option would be immense.

eyeopener2

Hi

It's difficult to advise without seeing the full picture but being £100 to £400 short a month, I take it it's really £400, is a lot to make up. What will selling the car get you? Will selling it clear some debts or just keep you above water?

If you can make it till June, and the final loan payment then that is a big chunk of that £400 and maybe you can shave of another £200 from your budget.

Why not post a full Statement of Affairs and then see where possible short term savings can be made. Like ST says, if you miss any payments or do tokens, your not getting a mortgage so you may as well go on a DMP, learn to live within a budget for the next few years and then come out off it debt free and on a stable financial foundation.

E2

minipenny_2

Thank you both. Much clearer now then I shouldn't get the dmp as I cant risk 6 years on my credit file! Sorry I wasn't clear the loan isn't for the car the loan is just a loan and the car is something we can live without for a year hence selling.

No we cant stay here for 6 years I understand where your coming from and thank you for the advice but its not a viable option for us I'm afraid (would be easier if it was lol!). We still enjoy family time and we do lots of free things with our children who are not missing out on anything just because we have a lot to pay out at the moment. And I wouldn't be happy saying I cant afford payments yet using money to "enjoy family time" as you put it, its our debt and I intend to pay it back.

Again sorry for being unclear. In 12 months we will have stopped with 2 loans and the CC payments will have reduced by at least £150 even if the 2nd jobs only lasted a few months that's all we need really The situation we're in as I said is a temporary stump also my pay increases every april so again will increase our income and next year we will be in a position for my oh to return to full time work (which is already available) near to the place we need to move to (40 miles away)

rising from the ashes - thanks for the tip i'll give them a ring and see. We've never missed payments before and i'll see if it appears as a default I hear you standingtall and I appreciate all your input too if the 6 year thing wasn't a problem and we could stay here for 6 years I would believe me I'm not just being fussy our petrol costs are a joke because work is so far away (where we are trying to move to lol)

I've had a look round and got some helpful tips I've sold a lot of stuff to mm and cex and I think I'll bundle some baby clothes up this week to get on ebay. I think i'm just getting into a panic when in fact things are going to be ok its only a couple of months I just need to sit down and breathe and go through all the finances and stop panicking! This site is so helpful and there's a lot of inspiration around

minipenny_2

eyeopener2 wrote: »

Hi

It's difficult to advise without seeing the full picture but being £100 to £400 short a month, I take it it's really £400, is a lot to make up. What will selling the car get you? Will selling it clear some debts or just keep you above water?

Lol yes I didnt want to go into a whole biography but I realise its not easy if you dont know the full picture!

its £71 this month 252 short in april, 348 in may, 149 in june, 40 in july and other various amounts between 100-300 for the other months.......I tried to average it......I was never good at math though :rotfl:


we're about 1500 short for the year basically.....which is second job wage I reckon. Car probably wont get more than £500 however I get insurance paid back to cc which is 800 back and nearly clearing that.