Road to recovery

startingtogetoutofdebt

I am about to sign an agreement with CCCS to enter a debt management plan. Having built up debts of £24,000 in just over a year and having been turned down for a further advance on my mortgage and a personal loan a debt management plan is my only option.

I am ashamed that I've managed to build these debts up in such a short period of time and have been unable to confess to my family.

The stress over the last few months has been incredible.

Although the decision to enter a debt management plan has kind of been taken out of my hands and despite the fact that I've been given lots of advice that it's the best option and will work out for the best in the end I still have worries and concerns.

I am concerned that if interest is still added to my credit card debts I will never be able to pay them off. I'm also worried about the effect this is going to have on my credit rating and it doesn't matter how much I try to convince myself that the debts and not being able to make minimum payments is destroying my credit rating anyway I still worry that I'm never going to be able to have any kind of credit again.

I really want to feel positive about the move I'm making but its very difficult - perhaps this will improve when the plan is set up and has started running but at the minute I'm having serious doubts about it!

Heffi1

Hi,

I had exactly the same concerns when I signed up with CCCS, your credit rating will godown, but because you have not managed to deal with the debt so far this is not always a bad thing, you will be able to sleep at night for a change and know that your debts are being dealt with and paid promptly each month.

While it is a difficult thing to do, you have done the hardest part and once you begin to live within your budget you will one day see that this is a blessing in disguise.

No it won't be easy, it will take time and you will wonder if you will ever get there, I had all of these worries and still went ahead, because it meant I did not have to fear the phone ringing, the postman calling with reminders. In the years I have been on my DMP I have had absolutely no letters or phone calls from any creditors and the interest was stopped, in fact once the companies knew they were getting less each month, they passed them onto Debt Collection Agencies and this was the turning point as they stopped the interest then, so all of my money as little as it is, is coming off the balance each month and it is coming down.

Be brave, it will get easier, I think the first month was the worst for me, then plain sailing after that.

Mort

Starting a DMP was one of the best financial decisions we made. Within a few months of starting the creditors had settled down and the phone calls stopped.
With credit lines shut down budgeting became key as did a number of lifestyle changes.

I recognise and sympathise with feeling of shame. You may need to tell your family as there could be occasions when you are expected to contribute money that you don't have. It is hard but we found it worthwhile.

If you have been turned down credit the unfortunate reality is that your rating is already wrecked.

Good luck with your DMP.

startingtogetoutofdebt

Thanks for the words of encouragement.

Paperwork is now printed out and ready to go. Just need to be brave and pop everything in the postbox.

Hopefully by christmas my DMP will be sorted and running smoothly and I can at least relax a bit knowing that everything is being taken care of rather than having to stress about how on earth I am going to pay everything back.

Total debts (excluding mortgage) as at 15/09/2012 = £24,000.

Heffi1

Good luck, it is the next step on the road to becoming debt free, so the sooner you pluck up the courage the sooner things will settle down and you can start to relax again.

antonic

You can do it !

I was in the same position 7 years ago.

I now have approx 3 months to go to clear my debts with a DMP administered by Payplan.

The feeling of relief I had when I made my first payment and could tell my creditors to speak to Payplan in future was almost better than *** - you know what I mean !.

You have made the right choice and wont regret it, I certainly dont and take pride in that I will pay ALL of my debts.

Good luck !

Oneday77

It's a big step but will be worth it.
Look at it this way, do you stress yourself ill over debt for several years or go DMP now, get several defaults now or very soon and then be credit file clean in 6 years.
6 years is not that long and will teach you to budget better, I know I did

startingtogetoutofdebt

Thanks for all the comments.
I've taken the step to start my DMP and have posted my agreement to CCCS and have sent letters to my creditors informing them of my situation.

I've also checked my credit rating as this was one of my main concerns and as my debts were high and had been turned down for credit my credit rating was fairly low already. In a strange way this news has made be feel a bit better about it all.

I've opened a new savings account so that if I have any few pounds left at the end of the month I can save them rather than buy stuff I don't need and don't really want. I've also cut up all of my credit cards including those which had no credit on them.

The hard work now is to make sure I stay within my budget which with two boys who want everything isn't going to be easy but I'm determined and feeling positive that we will be ok. Although it's going to be hard and take a long time I can at least start to feel like I've got something to look forward to rather than an immense feeling of dread every morning about how on earth I'm going to pay everything back.

Here's to positive thinking!!!!!

Heffi1

Hi that is great news, once you get things sorted out and the first couple of payments out of the way, you will wonder what all the fuss was about. Remember the companies may try to send you letters at the beginning until things are set up, don't worry about this. If you get phone calls, tell them you are working with CCCS and they will probably leave you alone. I promise it does settle down really quickly after that.

As to your kids, it will not do them any harm to learn about budgeting and you will be teaching them a lesson for life. My daughter often says I am so glad I learned from your example, i.e. not getting up to her neck in debt and then taking ages to pay it back, so some good has come out of it in a round about way

Mort

startingtogetoutofdebt wrote: »

I've also cut up all of my credit cards including those which had no credit on them.

:TThat's a good move. Mine went to the mother in law.

startingtogetoutofdebt wrote: »

The hard work now is to make sure I stay within my budget which with two boys who want everything isn't going to be easy

The Mortlets were in their mid to late teens when our DMP started. The situation was explained to them and they took it really well.

startingtogetoutofdebt wrote: »

Here's to positive thinking!!!!!

That's the important thing. It may not be easy to start with if creditors muck you around, stay strong and stick to your guns if they try to pressure you. There is plenty of support available here if you want it.:)

startingtogetoutofdebt

The first payment to my DMP is due to be paid on 10th October. I feel like my new life heading towards being debt free can really start then. I've been very lucky that a charity organised through where I work have very kindly given me a grant to help me over the next couple of months while everything with my DMP settles down and also to help me get through this christmas.

My next step is to sort out my bank account having realised that one of my creditors is owned by the same company I bank with. Luckily I have another bank account already due to the fact that I only opened my current account a couple of months ago and hadn't yet got round to closing my old account. I have done lots of research and know that I do not owe them any money so should ok with regard to creditors dipping into my account.

I had my first proper shopping trip to Aldi today rather than shopping at Sainsburys and also went to the local butchers to get a few bits for meals this week. I also went without the kids so no requests from my kids asking for stuff! Whole shop was done for less than £40 instead of the usual £100 +!!!!

I've got a little book to record all my spending and have to make sure that I have no daily trips to the Tesco near work so need to get out of bed an extra 10 mins early to make my lunch rather than buying. I feel like in the last couple of weeks my mind has gone from being spending mad to wanting to keep as much of my money as I can. I hope that doesn't wear of!!!!!

I'm now looking forward to checking out my debt statement in a few months time to see it going down instead of going up.