Repayment Dilemma

orchid2010

Hi Cloudy Day

30% is a good place to start, I have done some F&F's with creditors offered 25% and paid between 30/40%. If the counter offer was too high just told them not interested and it has made no difference to our paying by DMP. Also a good idea to say that a family member is lending you the money to settle your debts (don't go into too much detail). Don't let them know you could pay in full.

Hope it works out.

pure_dead_dopey

I would be reducing the mortgage, its ridiculous that you will be paying it until you are 76, what if, God forbid, you get ill and can't work until you are old enough to get a full pension.
If you use the money to reduce the mortgage, you'll no doubt reduce the payment term and possible the payment amount. Mortgage is secured debt, if the worst happens and you couldn't pay it, you could lose your place to live, unsecured debt on a DMP comes way down the priority list. I would also keep some of it as a wee emergency fund. family first, unsecured debt last

cloudy-day

orchid2010 wrote: »

Hi Cloudy Day

30% is a good place to start, I have done some F&F's with creditors offered 25% and paid between 30/40%. If the counter offer was too high just told them not interested and it has made no difference to our paying by DMP. Also a good idea to say that a family member is lending you the money to settle your debts (don't go into too much detail). Don't let them know you could pay in full.

Hope it works out.

Thanks thats really good to know.

cloudy-day

pure_dead_dopey wrote: »

I would be reducing the mortgage, its ridiculous that you will be paying it until you are 76, what if, God forbid, you get ill and can't work until you are old enough to get a full pension.
If you use the money to reduce the mortgage, you'll no doubt reduce the payment term and possible the payment amount. Mortgage is secured debt, if the worst happens and you couldn't pay it, you could lose your place to live, unsecured debt on a DMP comes way down the priority list. I would also keep some of it as a wee emergency fund. family first, unsecured debt last

Thats my thinking too - but if I get reduced F&F thas more to pay of the mortgage with (in later years).

I suppose the point is that none of know what the future hold. As I've had other family members die young I think I never really worried about getting older - because I thought there was a good chance I wouldn't!

Wish I could nip back and give the 18 year old me some advice - that was when Barclaycard gave me a £5k credit card. At the time I was a student with no full time job prospects for at least 3 years! Took me a good 20 years to get to the point of sorting out the DMP.

Well at least I'm doing my best now.

TakingControl

Firstly sorry to hear about your mum.

Personally I would go with F&F offers as there is no garantue that none of the creditors in future try and obtain CCJ and charging orders against your house. In addition to that, they know it will take 16 years to get their money back vs now but part settlements.

I had £45K debts to pay alone and was able to get F&F on two of my debts at 55% and 60%, one being MBNA and one Barclays.

I would try the F&F route but make sure you state that the money for tis is a gift from 3rd party and have everything in writing before relasing any funds. Then chuck anything you got left at the mortgage and try and overpay with what you normally pay on the DMP.

pure_dead_dopey

Life happens and you just have deal with it. Somewhere to live is the most important thing. The older your debts become, the more likely you'll be able to F&F at a reasonable rate. Personally I would reduce/stop the DMP to either nothing or the lowest possible payment and throw everything at the mortgage. BUT I would also suggest that you try to live a life as well.you only get one shot at life and this is it. pack money away for your old age, get rid of the mortgage as fast as possible. Any money you pay to the mortgage, you are technically keeping for your old age to support you then, if you pay off the unsecured debt, that money is gone and the only peeps who have really benefitted are the banks. It is a fact that you will have to be able to contribute to your own old age, the state pension won't do it and you need to start thinking about it now. Worrying about unsecured debt shouldn't be a priority, its the least of your problems.

cloudy-day

TakingControl wrote: »

Firstly sorry to hear about your mum.

Personally I would go with F&F offers as there is no garantue that none of the creditors in future try and obtain CCJ and charging orders against your house. In addition to that, they know it will take 16 years to get their money back vs now but part settlements.

I had £45K debts to pay alone and was able to get F&F on two of my debts at 55% and 60%, one being MBNA and one Barclays.

I would try the F&F route but make sure you state that the money for tis is a gift from 3rd party and have everything in writing before relasing any funds. Then chuck anything you got left at the mortgage and try and overpay with what you normally pay on the DMP.

Thanks - that seems to be what I'm leaning toward.

pure_dead_dopey

TakingControl wrote: »

Firstly sorry to hear about your mum.

Personally I would go with F&F offers as there is no garantue that none of the creditors in future try and obtain CCJ and charging orders against your house. In addition to that, they know it will take 16 years to get their money back vs now but part settlements.

I had £45K debts to pay alone and was able to get F&F on two of my debts at 55% and 60%, one being MBNA and one Barclays.

I would try the F&F route but make sure you state that the money for tis is a gift from 3rd party and have everything in writing before relasing any funds. Then chuck anything you got left at the mortgage and try and overpay with what you normally pay on the DMP.

Every piece of debt advice you will find, tells you to prioritise the priority debts, ie mortgage, utilities etc. Why on Earth would that change in this case. The op is in his.her late 40s with no guarantees of full employment until retirementm got to secure his position not his creditors

cloudy-day

I'm a she!

Thanks, I do see where you're coming from, but by paying off the creditors (full or reduced), I have an extra £400pm to chuck at the mortgage.

Its not simple though.

mrsb83_2

pure_dead_dopey wrote: »

Every piece of debt advice you will find, tells you to prioritise the priority debts, ie mortgage, utilities etc. Why on Earth would that change in this case. The op is in his.her late 40s with no guarantees of full employment until retirementm got to secure his position not his creditors

You're misinterpreting this advice. When you don't have enough money to pay your monthly liabilities, then you have to prioritise your mortgage and utilities to make sure you have a roof over your head. I haven't seen anyone on this board who has a debt problem pay their mortgage off before tackling other debt.

In any event, at the £60k level of debt, and with a long projected repayment date, I'd be concerned about CCJs and possible charging orders. I would use follow the advice here and try to secure F&F settlements.

Do you really want to be on a DMP for another 16 years? This is an opportunity to clear everything other than the mortgage, start overpaying that with a minimum of £30k, and use lifestyle changes and the equivalent of the monthly DMP payment to bring the mortgage free date forward.