Is the dmp a scam ?

michiebaby

My husband has started a debt management plan through immediate financial he found it via moneyexpert thinking he was on this site. He has been paying them money but has signed no contract, all his creditors are threatening final demands/court actions. He phones immediate financial but doesnt seem to get any answers, is he being conned ?

Better_Off_1983

I hope they are not a company that charges.

By right, they should be sending your husband a pro-rata statement of how much they will be paying each of his creditors or at least keeping him in the loop as to what is going on with all of the creditors. All the creditors should have sent a Letter of Authority to all of the creditors meaning they will be acting on your husband's behalf. They should also say that Such and Such Bank has been contacted just awaiting their response etc

I am guessing if they are a fee charging DMC, they will take 1-3 of your husbands first payments and THEN start paying and contacting your creditors thereafter.

Has your husband advised all your creditors that he is in financial difficulty before going with this DMC? Because they could put him on a temporary arrangement, however, it will affect his credit rating because he will not be keeping to the contractual agreements.

Edited to add: I have just looked them up and they do look like the sort of company that charges and keeps 1-3 of the initial payments before distrubuting payment.

I really do no know where he stands, if he has not signed a contract, I think he can ask them not to act on their behalf by cancelling within the first 14 days, but I am really not to sure, because some companies like this tend to take it as a contract when you make a payment with them. Did he speak to someone over the phone and they did a sales pitch with him?

These companies claim to stop interest and charges, but it cannot be guaranteed. However, your husband could be paying them £200.00 per month for example to go to all of your creditors, however, the DMC will keep about £50.00 for their own pockets and only distribute £150.00 to all his creditors. Imagine is he owes thousands to one particular creditor and the DMC only offers pittance to them? However, the DMC will make sure they get their cut of your husband's money, no quibbles there!

Imagine if the interest and charges are not stopped, you have to class the DMC as an extra creditor because you will owe them money for their services.

I work in finance myself. I used to work in a debt managment company, but left because we were trained to not let consumers/debtors use free DMCs and come with us. We had a script to follow and had to advise the debtors there would be a long waiting list for CAB, CCCS and there would be poor and non-personal service. We had to sell our DMC products on the notion that there were dedicated Account Manager liaising with their creditors. It is all a bit of a scam. I wanted to work there so I could see both ends of the spectrum. I used to work as a debt collector ( over the phone - a nice, empathetic one!) and I had alot of debtors say they could not pay their arrears because they were with a DMC. However, when I worked in the DMC, we had to run through an income and expenditure with them and make them feel like they were going to get a consolidation loan (We got their details when they applied for loans online and their details were passed on!). I left because I felt like I was being deceptive.. there was a script we had to follow and I did not agree with it, it felt unethical. When I went for the interview, they made it seem like I was really helping debtors, where really it was a sales tactic.

I currently work back in debt collection, have done for many years on and off. I would have thought it would be easier working in a DMC. I really thought debt collection would be worse than DM, but I would not recommend working in DM especially a fee charging one, it is just 'glamourised' sales.

Sorry to waffle.

Hope this helps

By the way, Immediate Finance charges 17.62% of £30.00 whichever is greater- more than likely the % for using their services. This company also keeps the initial payment(s) in their own bank account earning them interest and saving them from insolvency! Then later sharing it all out.

vickthestick

Wow! Well that's an eye-opener Better-off. Thanks for sharing the info.

plum44_2

So in summary, please cancel this and go to CCCS or Payplan who will do a much better job for free.

antonic

I recommend Payplan !

I only have 7 months to go from an original 84 months and recommend them to you !.

All the admin stuff can be done online, so no expensive phonecalls.

For example this week I did my new budget online to run till the end of my plan, and it was all agreed within 3 hours.

bridgemant

From my own experience, please listen, get on a DMP with CCCS or Payplan NOT IMMEDIATE FINANCIAL.

They are con men who are only interested in their own financial gain and don't care about ripping off their clients for several thousand pounds.

I have posted my own thread on here with my full story but the short version is, STAY AWAY FROM THEM!!!

michiebaby

wow thanks for info got me worried now as has definately been longer than 14 days so don't know where he stands will have to look into this further. : (