Would you sell house whilst on dmp?

mummybiz5

Need some advice please - we are in a ten year dmp with cccs - our house is needing electrical work and we are very squashed with 5 children in a 3 bed semi. The house is valued at £144000 and we owe £127000. Renting a bigger house would cost around £60 more a month than our mortage and everything would work safely ! Selling the house could net just enough to get 6 months rent upfront which we are told we will need due to being on a dmp.
We are on NRAMs svr so when mortgage rates go up we will be paying a lot for the house - dmp takes every last penny so no chance of doing any work on it. Have pondered the idea of assisted sale but no mortgage arrears as yet. As we owe £50000 on dmp have also considered voluntary repo and bankruptcy - any thoughts anyone?

Gimpsdad

Not another one?

If you divide 50,000 by 10 years you get £416.66 per month. Is this about right for your payment?

If so, why on earth are you not on a 5 year IVA? In 99% of cases an IVA beats a DMP by a million miles. In 95% of those cases, an IVA payment is lower than a DMP payment as well, easing your monthly budget. That way you get to keep the house. CCCS don't seem to like IVA's, illustrated by the fact that the largest debt charity in the UK has only one IP for 10's of thousands of enquiries each month, so they seem to put people on DMP's as their default position. Visit iva.com for a list of IP's

If you still want to sell, then do so and once done consider IVA or even bankruptcy, this DMP is useless to you. No debt solution should take every penny off you. They are meant to be fair deals, not a prison sentence.

mummybiz5

We managed to get ccccs to reduce payment which was first set at £700 a month nearly as much as our mortgage. They say they w on't reduce it from its current £400 as it Would take too long to pay off. We have 5 children who will need help through uni .DH is a teacher with high blood pressure and this DMP feels like a prison sentence. We have paid off £13000 so far but are losing the will to fight on - come close to a divorce with the stress and after being married twenty years to split up over money stress would be a tragedy. We did lots of moving house making a profit until we bought one with an right ofway issue which ended in us losing £30000. Scared of moving into rented withbad credit in cae have to keep moving - ironic !, Will look at IVA inmore detail - thanks

mummybiz5

Apologies for last post typos - space bar sticking!
One thing which put me off IVA when I looked briefly before was that we are on the SVR with NRAM and if our mortgage went up during the time of the IVA it didn't seem there would be much flexibility to cover the increased mortgage payments - any thoughts?

Gimpsdad

"They say they won't reduce it from its current £400"

Scandalous, outrageous and lots of other words that are inadequate to describe the treatment you describe here. Who on earth do they think they are to dictate to you what you can afford?

Flexibility is a given in an IVA, no one, not even the mighty CCCS can ask you for money that you cannot afford. It is true that sometimes it is more difficult to arrange said flexibility, but when compared to what you have now, where they simply refuse to help you, it has to be a darned sight better. Can I ask, do you have the NRAM together mortgage? It would help you enormously if you do. As no one knows when interest rates will go up that is something you will have to address when it happens, but at the very least the IVA will give you a definitive end period and legal guarantees that you don't currently have. It will also be far cheaper than what you pay now (99% certain), given the circumstances you describe here.

mummybiz5

We don't have the together mortgage (we turned it down when the broker offered it!) we had a fixc now on the svr. As time goes on the more I feel like CCCS are acting in the interests of creditors not the debtors.
One big worry for me with reading the IVA thread is that I have had a couple of ppi payouts - one used entirely to pay debt the other partly to pay debt and to replace essentials such as washing machine car repairs, kids clothes as allowance not big enough for this from cccs and to bump up our monthly money as we were struggling - will I have to pay this back or is it as case of it has gone now ?

mummybiz5

I also don't have an income - our debts are separate yet CCCS have us on a joint DMP and I pay my contribution to the DMP from child benefit and tax credit which I find ridiculous as I need this money for the children CCCS don't seem to see any problem with it?!!

Gimpsdad

If you have already reclaimed the PPI and it is gone, in this case at least partly on undeniable essentials, then whats done is done would be my take on it and you would not be expected to pay back money that was rightly yours anyway.

I can sympathise with your point of view re your income, but to be fair to CCCS as well, the creditor held view is one really of this should almost always be viewed as a joint situation, and therefore where the money comes from is slightly less relevant than the fact that it is paid at all. I can also understand your point of view in regards to acting in creditors rather than debtors interests, although I am sure they would disagree with that, mind you they would, wouldn't they?

I would strongly urge you to contact 2 or 3 IP firms to speak to someone impartial as to your options. I know of at least 1 firm that will look at interlocking IVA's for you from as little as £180 per month (that may be less in certain circumstances, more in others) and you have nothing to lose by doing so, only a shedload of debt, and everything to gain, including keeping your house instead of selling it.

mummybiz5

Will defo look further into the IVA - thanks for advice














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rubyjam

Hi mummybiz15, sorry I don't have any advice - I just wanted to sympathise. Our DMP also feels like a prison sentence, it's crippling us, the end date is a lifetime away. Like you we have been married 20 years, only have one income and children who require school shoes, food and a roof over their heads. We are finding it very difficult at the moment and don't have enough money for food never mind putting a bit away at the end of the month for final payment offers which I read a lot of folks on here seem to manage to do. How do they do it!!?? I thought a DMP was supposed to stop the sleepless nights - but now instead of worrying about the nasty letters I'm now worrying about how I'm going to feed us all.

Gimpsdad, CCCS never gave us the option of an IVA. They suggested a DMP or Sell or Bancruptcy. We were also told DMP payment would need to be above a certain amount for it to be accepted. Would we be able to keep our home if we switched to an IVA? We went down the DMP route as it seemed like the best option of a bad bunch.

We did consider selling but our mortgage is considerably less that the cost of any rental property so I'm not sure we could afford to rent

mummybiz5

Hi Rubyjam - we would have to pay a bit more to rent but our house needs so many major works doing. - a rewire , new windows because they are rotting etc we will never have the money to fix whilst on the dmp - CCCS budget is so difficult with children - clothes foR the kids and i mean essentials like one pair of shoes, one top etc are coming from the food budget!!