Dmp settling

Loodlelou

We have been in a dmp with the cccs for the past 3 years and we still have 2years to go. We are in the process of selling our house and it is our intention to pay off our debts in the process. However we also need to put a deposit down for a house to buy and so was thinking of offering a settlement figure to our creditors. Is this likely to negatively affect our credit rating (which is pretty shot already)? Or is it better to pay the debt in full and put down a smaller deposit or even rent for a while until we save up for the deposit. So confused, don't want to make a massive mistake by selling our house then finding that no one will lend to us or rent to us in the future. Any suggestions would be very welcome.

antonic

As your on a DMP, your credit rating is shot already.

Also as your on a DMP you *may* find any F&F settlement you offer being rejected as your already on reduced payments through being on a DMP.

The choice as to wether buy or rent is upto you, but you *may* find you being on a DMP will affect your prospects of getting a mortgage because your asking to borrow money, while struggling to pay what you already owe.

Also if you have defaults on your credit file, they stay with you for 6 years, which will affect your chance of getting a mortgage.

Sorry to be the bearer of bad news.

Mort

Payplan warned us that settling debts at a reduced rate might be recorded as a partial settlement.

We were able to change mortgage products with the same lender without any hassle. That's not the same as getting a new mortgage though. If you have an existing mortgage why not book an appointment with the lender and see what they can do for you.

eyeopener2

Plenty of people have had F & Fs on DMPs, especially if you have long time to go so it's always worth a shot to see what they will take, anything from 30% upwards.

The mortgage thang is a totally different thing. The best approach is through your current lender but you do have to remember, as others have said, is that you are already a credit risk. This doesn't mean you won't get a mortgage, it just makes life more difficult.

Have any of your debts gone to default yet?

revelling_in_poverty

eyeopener2 wrote: »

Plenty of people have had F & Fs on DMPs, especially if you have long time to go so it's always worth a shot to see what they will take, anything from 30% upwards.

The mortgage thang is a totally different thing. The best approach is through your current lender but you do have to remember, as others have said, is that you are already a credit risk. This doesn't mean you won't get a mortgage, it just makes life more difficult.

Have any of your debts gone to default yet?

Yes, I checked my credit report and all our creditors have registered default on our record. Our current lender have agreed in principle on condition that it is no more than80% loan to value and that debts are cleared. This is why I want to try and keep as much equity as possible for our new home. Otherwise we just rent and start over in a couple of years when we will hopefully have a bit more creditworthiness.