DMP Newbee - Hello & My Story!!

nfollows1982

I just wanted to introduce myself and my situation as I think I will try and contribute a bit more as reading some of the advice on the forums has really helped me see the light; it would be nice to be able to repay the favour in time and give my own advice back.

My situation will probably sound all too familiar so I will keep it as short as possible!

I was completely debt free in 2007 after paying off the last £600 of my loan with NatWest; I had no credit cards, no catalogues and not even an overdraft.

As I was looking at getting a mortgage I decided to get a CC to use and pay off in full in each month to help build up my credit rating. The first one was just a £900 limit with the bank which quickly led to £6k limit with the bank, £7k with Barclaycard, £8k with RBS, £5k with egg, £6k with virgin and £4k with MBNA.

All of a sudden I was sat with 7 credit cards in my wallet and well over £20k worth of available funds! I completed on my house in April 2008 and things were still well under control but I found myself saying ‘I’ll just put this on the card’ and before I knew it I’d blown about 10k on my cards (including paying 5k for a car!!).

I also got large credit limits with the catalogues and a wardrobe full of designer clothes on BNPL which then got transferred to the cards. I have spent the last 2 years transferring balances here there and everywhere to get 0% but as soon as one card was cleared I would spend on it again! My bank account lived in its overdraft and things spiralled.

In December 2011 I was just over £16k in debt and I got accepted for a loan with NatWest for £20k which was (a) to consolidate and (b) to pay for my wife to have a sterilisation reversal. It seemed like the best idea at the time and I honestly thought just having the one payment would be easy to manage.

HOWEVER…..!! (this will sound familiar) the consolidation failed miserably. Although I closed every catalogue, and paid off all my credit cards I decided to keep 2 of them open albeit with reduced credit limits of £1k and £1.5k. Needless to say these are now maxed out which then led to me getting a Capital One and a Vanquis CC on top, both of which are now maxed out.

I’ve never missed a payment on any of my facilities but I was paying out so much month to month to keep on top of it I was borrowing more and more to live on.

I had my LBM yesterday morning when I was sat at work about to complete on a £400 Wonga loan which I had no way (or intention) of paying back and I realised things had to change (I didn't get the money thankfully). Going back to (b) above my wife is now pregnant and I realised that if I didn’t get things under control we’d never manage and I didn’t want that for my family.

After reading through some more forum posts yesterday I decided to contact Payplan and I had my telephone appointment yesterday. They gave me several options but I have decided to go down the DMP route and instructed them last night to set the wheels in motion. I had the option of an IVA but as I bought my house with my sister and she is still on the mortgage deeds I would need her permission to release equity and I didn’t want to involve her in this.

So this morning I am feeling (a) relieved (b) overwhelmingly guilty for letting things get this bad and (c) extremely nervous about the DMP and how it all works!

I’m really hoping that my creditors will agree to suspend the interest and charges and I can start making inroads into the debt mountain and also try and enjoy life a bit more without the monumental stress of worrying where the next ££££ is coming from!

rdchick

Well done on facing up to your debts!

It is scary, it is gut renching and full of guilt but you've faced up - and now it's time to put it right! I am also embarking on the road to debt freedom and getting myself a DMP so don't feel alone!

Congratulations on the baby on the way too

xxx

TeamNicholson

As previous poster said, well done on facing up to your debts. Its all too easy to stick your head in the sand when things get tough! I have a toddler and another baby on the way, and it is them that keep me motivated to keep going with my debt busting.

So my only advice is when things tough, and you fell like you have no money or social life, think about the future you are going to provide for children because of the sacrifices you are making today.

Budget, budget, budget!

nfollows1982

Thanks!

I'm sure I will feel better once the DMP is actually in place and that first payment goes through to Payplan. It would just really make me feel like I am getting somewhere.

With regards to the DMP, I know it's more of a 'gentlemans agreement' but what are your experiences with creditors agreeing to freeze interest and charges?

Also, if worst comes to worse and they dont, won't I see my debt increase every month with not meeting the payments?

My main creditor is NatWest and I have heard various stories about them both accepting a DMP and being no problem to them being a complete nightmare to deal with.

Payplan said they have a good relationship with NatWest so are hopeful they can come to an arrangement but its the going from all payments up to date to defaults etc that is worrying me the most

rdchick

I know what you mean about the initial payments etc. What worries me is the calls and the emails and texts and letters that are going to bombard me for the next few months. I have decided to go with CCCS for my DMP but haven't written my letters yet and things are bouncing out of my account left right and center! I'm not used to not paying things on time but that is partly why I am in such a mess because I'm taking out credit to pay for credit

I've heard that the majority either bring the interest right down or remove it and stop charges as a DMP is getting more common so they know the deal - they know no matter how much they beg you for more money- you won't give it to them - because you can't!

xxx

nfollows1982

Do you have to contact your creditors yourself then?

When I spoke to Payplan last night they said that I would just have sign a form to give them authority to contact the creditors on my behalf and they would take care of everything for me.

rdchick

You can contact them and just say lookie here I'm going on a DMP whilst it's being set up here's a quid! It keeps them off your back apparently

But Payplan will sort them out!

I also want to write to them all and say don't call as I will only deal with you in writing! xxx

nfollows1982

Yeah PP did mention something about making token payments if anything was due before the DMP was in place.
I have actually paid my loan this month which was £450 and that is my biggest worry so I have a months grace with that at least.
What have you done about changing banks? I believe I have to as my current account is with NatWest and I need an account away from any creditors.

Also, what about your direct debits? Have you cancelled everything that is due to your creditors?

Sorry for all the questions, you've probably got just as many as me!

rdchick

My main bank is with Halifax (also where 70% of my debt is too) but I have now told my employer to use my Santander account to put my wages in It's best to have an account that is nothing to do with where your debt is so you need to steer clear of RBS, Halifax, Ulster (think that's all) however I have heard RBS are to take over Santander... which is worrying as it means moving everything again!

I haven't cancelled anything yet apart from my standing orders which I have transfered over to my Santander account.

I think my car insurance has bounced... which is worrying as I need to change that direct debit over too... and mobile!

xxx

nfollows1982

Ok thanks for that.

Nearly everything went out the day after I got paid on the 26th June so by acting this early in the month I'm hoping I've got enough time to switch everything over before all my household bills are due again.

I've still got 2 or 3 non creditor DD to come out this month, coucil tax, house insurance and phone so I have left enough in my account to cover that.

I'm aiming to have my July salary paid into my new account and have all the direct debits set up in good time too.

I will feel better knowing that is sorted and the saving grace is that I've never missed a payment for the mortgage so I don't have that to worry about on top.

It is actually good to talk about it with someone who is in the same position. Makes me realise I am not alone in being a bit overwhelmed by it all!

rdchick

Yeah it is good to know someone else is in the exact same position and we can go through it all together!

I am in this mess as I got tangled up in a few payday loans so they've taken their share and I was left with about £100 which will go to car insurance etc. That was my wake up call to sort it all out.

I persuaded my ex boyfriend to set up a DMP just before we split up a few years ago, I've seen how bad debt can be when you worry sick and are completely lost, I knew I never want to get that bad (even though most of my debt is from supporting him!)

It's just money but it is a little bit scary! xxx