going on DMP - should we sell house?

fatbelly

mini10 wrote: »

Hi Nivea,

Your post caught my eye as I have been thinking of doing exactly the same thing, the thought of selling and being able to pay of debts is very tempting....

I owe approx £40k, I havent had the courage to add it all up properly and I am very ashamed to be in this state. I dont think I have anywhere near that equity in my house but as my high mortgage repayments (approx £900 per month) have meant I have lived on credit cards for past few years then to go to a cheaper rent again is tempting.

I havent mentioned it to my DH yet as I dont think he would be keen. Was thinking of having house valued by Estate Agent and seeing state of play then.

I hadnt thought about a DMP, that might be worth us looking at - will that affect credit rating for things like phone contracts and renting do you think?

Will follow your thread with interest- good luck.
Mini :

Mini - why don't you start your own thread and post a statement of affairs ?

Nivea_2

thanks for the great advice, have decided to not sell and pay my debts off asap on my dmp x

Giraffeseeker

Nivea wrote: »

thanks for the great advice, have decided to not sell and pay my debts off asap on my dmp x

I think this is the best thing you could do. I was always useless with money, my ex-husband and I remortgaged and then ran up credit cards, loans, remortaged again, etc etc.

Finally paid off all the debts when we divorced and sold the house. Left me with only a couple of £K out of the divorce but was lovely to be debt free. BUT I hadn't addressed my over-spending, and hadn't learnt how to budget....

I got a labour government keyworkers loan to fund deposit on new house purchase as a single parent. I don't regret this. What I do regret is that I then very quickly built up £40K of unsecured debts.

I am now paying this off over 5 years on a DMP. It is almost the same amount as my keyworker loan. I am kicking myself that I could be paying that off, but instead I am paying of debts that I cannot even remember what I spent the money on.

By being on a DMP I am learning the value of money, learning to budget and to save (in practice - not just in "theory" on a spreadsheet) and learning to live within my means and without a credit card.

Selling my home to repay debts didn't teach me that. Being on a DMP for 6 months has taught me that.

It's the best decision you can make for your long term future. I wish I had done it years ago. Good luck!

Scottishmummy

Hi Nivea, welcome to the boards.

I am also on a DMP but I have about 14 years to go on it. I wouldn't dream of selling my house as there is no way we could afford renting. Our mortgage is about 1/4 what rent would be round here and we have about twice as much equity as is still owed on the mortgage but it would all have to go on the debts leaving us with nothing for a deposit. We also would never be able to get back on the property ladder as our combined earnings are now a third less than I alone was earning before being made redundant - hence why we are now on the DMP. We have been lucky in that all of our creditors have stopped interest. We found that a couple carried on charging interest for the first 6 months but when they realised they were only going to get from us what we were paying they stopped too. If any of the debts get passed on to DCA's then interest is automatically stopped.

And before Gimpsdad gets on his high horse about why we are paying out for so long - we ran up the debt so we aim to pay it ALL back. We have no interest in getting credit again and no chance of moving so being clear of the DMP sooner rather than later makes no difference to us. As it is all but one of our defaults is now off our credit records as RBS decided to wait 3 years before defaulting us.

Good luck with your journey.

mini10

Hi Nivea,
Just wondering how you're getting on? hope things are going well for you

Nivea_2

hey thanks for thinking of me x

all going well, started dmp and have had no phone calls or horrible letters, 3 out of 5 creditors have stopped interest and charges too.

I have taken on board the advice here and I am going to see the dmp through, rent would be double our 560.00 a month mortgage.

how are you doing? X

Nivea_2

and for the first time in years I am over half way through the month and still got 400.00 in my bank account! Dmp is really helping me value my debt and my responsibilities to pay it off,paying off by selling the house would be too easy to get into debt again x :beer: