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changeforbetter

StepChange_Rory wrote: »

Hi Changeforbetter,

With any debt solution we would always look at your full financial situation before making any recommendations. A debt management plan (DMP) is just one of many debt solutions so try not to worry too much about whether this is the best way forward for you at this stage.

We can look at your whole situation first and offer you advice and a solution on the best way forward.

Why not have a chat with us about this? Our advice is free, impartial and confidential.

You can speak to us over the phone or use our on-line Debt Remedy tool by visiting our website www.stepchange.org.

I hope this helps

Rory

Thank you very much for your reply Rory. That is comforting to know.

However, could you still clarify, is it possible to have a DMP in place if you own (mortgaged) your own property? Or is this something that is never allowed?

I know there may be other options, but would really appreciate knowing whether it is possible (or ruled out in all cases) as a DMP is really seeming one of my last alternatives (other than worse cases like IVAs etc) .

Many thanks for any advice.

Former_StepChange_Rory

changeforbetter wrote: »

Thank you very much for your reply Rory. That is comforting to know.

However, could you still clarify, is it possible to have a DMP in place if you own (mortgaged) your own property? Or is this something that is never allowed?

I know there may be other options, but would really appreciate knowing whether it is possible (or ruled out in all cases) as a DMP is really seeming one of my last alternatives (other than worse cases like IVAs etc) .

Many thanks for any advice.

Hi changeforbetter,

It is possible to have a DMP if you have a mortgaged property and there are no rules against this.

If you are looking at the best way forward from here then I would recommend using Debt Remedy as this will offer you the best advice and solution based on your circumstances. You could also call us if you prefer by visiting our website www.stepchange.org.

You might find by putting together a budget and reading over your options that you're able to take the next steps to getting your finances back on track.

Hope this helps again,

Rory

changeforbetter

StepChange_Rory wrote: »

Hi changeforbetter,

It is possible to have a DMP if you have a mortgaged property and there are no rules against this.

If you are looking at the best way forward from here then I would recommend using Debt Remedy as this will offer you the best advice and solution based on your circumstances. You could also call us if you prefer by visiting our website www.stepchange.org.

You might find by putting together a budget and reading over your options that you're able to take the next steps to getting your finances back on track.

Hope this helps again,

Rory

Thank you very much for replying again. Yes, that is most helpful. Hopefully I can get my finances sorted at some point in the future. Thanks again.

PJVW

Hello, first time post... I need some advice about renewing my mortgage next year.

We've been on a DMP for 4 years and have never missed a payment. My mortgage is up to date and I've never missed a payment for that or any bills. My Experian score is 999 and I have an LTV on my mortgage of around 50%. Our mortgage is due to revert to variable rate early next year but it is likely that we will still be on the DMP. My IFA says that due to the new mortgage lending rules this will stop us being able to get a new fixed rate mortgage and we'll have to stay on SVR until the DMP is paid off, which is probably around 2016. My concern is that with interest rates due to rise that will significantly increase our monthly payments thus delaying the debt-free date further.

So, does anyone know if it is possible to get a new fixed rate mortgage while on a DMP? Or, should I contact StepChange and revert all of our debts back to normal payments and cancel the DMP?

One further point is that most of our creditors defaulted us in 2010, but Lloyds defaulted us in 2010 and then changed that date to 2011 and then again to 2012. After a complaint to the FOS they changed it back to 2011, but ideally I'd like to get that changed back to 2010, so that will all drop off in 2016. So, my second option is to go to SVR until the defaults drop off and then get a new mortgage in 2016?

Thanks for any advice...

Former_StepChange_Rory

PJVW wrote: »

Hello, first time post... I need some advice about renewing my mortgage next year.

We've been on a DMP for 4 years and have never missed a payment. My mortgage is up to date and I've never missed a payment for that or any bills. My Experian score is 999 and I have an LTV on my mortgage of around 50%. Our mortgage is due to revert to variable rate early next year but it is likely that we will still be on the DMP. My IFA says that due to the new mortgage lending rules this will stop us being able to get a new fixed rate mortgage and we'll have to stay on SVR until the DMP is paid off, which is probably around 2016. My concern is that with interest rates due to rise that will significantly increase our monthly payments thus delaying the debt-free date further.

So, does anyone know if it is possible to get a new fixed rate mortgage while on a DMP? Or, should I contact StepChange and revert all of our debts back to normal payments and cancel the DMP?

One further point is that most of our creditors defaulted us in 2010, but Lloyds defaulted us in 2010 and then changed that date to 2011 and then again to 2012. After a complaint to the FOS they changed it back to 2011, but ideally I'd like to get that changed back to 2010, so that will all drop off in 2016. So, my second option is to go to SVR until the defaults drop off and then get a new mortgage in 2016?

Thanks for any advice...

Hi PJVW

Thanks for getting in touch.

There are lots of factors that can affect a mortgage application especially with the recent changes to the process. I'm not able to offer specific mortgage or financial advice but I can hopefully point you in the right direction.

A debt management plan (DMP) will likely have an impact on your credit file as you're making reduced payments to your debts. How your mortgage lender or creditors perceive or use this information is really down to them.

As a charity we also have a Financial Solutions team who can look into this for you and offer free, impartial advice on mortgages which could really help you in this situation.

You speak to the team by calling 0808 168 6719. We're available
Monday to Friday 9am to 5pm and calls are free from UK landlines.

Please ask to speak to Tim or Paul and we'll be happy to have a chat with you about this.

Hope this helps,

Rory

doorstep54

am really getting stressed out and worried!! am getting help from stepchange and I recived yesterday my date for my 1st token payment and they said they will be contacting my creditors, to tell them whats happening also I sent out letters to some of my creditors telling them am in financial difficulties and step change helping me, and just got in from work only to find more letters from my creditors telling me to bring my accounts up 2date and telling me to ring them, am scared to ring them I don't want to talk to them as am scared what they are going to say, I just feel like am going to have a breakdown with all this, what shall I do? about these letters keep coming

Former_StepChange_Rory

doorstep54 wrote: »

am really getting stressed out and worried!! am getting help from stepchange and I recived yesterday my date for my 1st token payment and they said they will be contacting my creditors, to tell them whats happening also I sent out letters to some of my creditors telling them am in financial difficulties and step change helping me, and just got in from work only to find more letters from my creditors telling me to bring my accounts up 2date and telling me to ring them, am scared to ring them I don't want to talk to them as am scared what they are going to say, I just feel like am going to have a breakdown with all this, what shall I do? about these letters keep coming

Hi doorstep54

Welcome to the forum,

First of all, try not to worry about the letters you're receiving. I know some of them may be quite difficult to read but the creditors are just following the normal collections process. Often these letters are generated automatically and sent out in bulk so try not to feel like they're targeting you specifically.

If the letters ask you to contact them just make sure you've sent the template letter so they're aware of the situation as this could help reduce letters and calls.

It can often be reassuring to know what your creditors can and can't do at this point. We have an article on our website that covers this which is available here

If you do want to speak to us then please don't hesitate to get in touch and we'll be happy to offer our help and reassurance. Details of how to contact us are available on the StepChange website.

I hope this is helpful,

Rory

pestcontrol

StepChange_Rory wrote: »

Hi pestcontrol,

Thanks for getting in touch.

Once the business has closed then any remaining debts that are personally guaranteed would be your responsibility to repay.

We would treat at any unsecured debts as a non-priority though as you can only repay what you can realistically afford. We wouldn’t advise you to take on extra debts or consolidate as this could cause further problems if you fall behind with the payments.

Try not to worry too much about your credit rating as it’s more important to prioritise your household bills and living costs and keep them up to date as falling behind with these can have a greater impact on you.

We recently wrote a blog post about people who are worried about debt and are concerned about how this might affect their credit rating.

There's no reason why you can't get help from us before your business closes as we can offer plenty of help and support.

If you think you’re going to fall behind with your payments we can offer your free, impartial advice and solutions to help get your finances back on track. You can put together a budget with us using Debt Remedy or contact us over the phone by visiting our website at www.stepchange.org.

Hope this helps.

Rory

Dear Rory,

I really can't thank you enough. I spoke to Owen at length yesterday, he was incredibly helpful. I'm hugely grateful to you all. Thank you very much!!!

Warm regards

Sam

Zio

Hi guys!

I'm really very new to the forum and haven't had a chance to do much reading, but I'm in quite a bad situation debt-wise and it's been going for many years now. I need a permanent solution to sort my debts out.

Despite being in my mid-thirties, I'm currently living with my parents. I moved back in last December in an effort to really sort out my debts, but problems at work have prevented me making the progress I was hoping for (my job role moved unexpectedly, so I have an incredibly expensive commute that the extra pay they gave me doesn't really cover).

Okay, so my debts then:

- I have a £3,000 overdraft with Lloyds which is normally pretty maxed.
- I have £5,000 remaining from a £16,000 Lloyds loan I took out in August 2009.
- I have approximately £7,500 balance on a Barclaycard which is reaching the end of it's interest free period.
- I have approximately £10,500 balance on a Virgin MBNA credit card which has now reached the end of the interest free period.

So about £26,000 - £27,000 total.

I guess really I'm wondering how best to tackle it all. Thanks to my parents letting me stay with them and the fact I earn roughly £28k salary now, things are not in a total crisis. I can afford to make my minimum payments every month, pay child maintenance and my necessities and still have a little left over. This is probably going to sound very callous and selfish considering what other people must be going through, but I'm just fed up of years of just getting by and not having any savings or anything. All this debt has hung around my neck since around 2007 or so.

When I lived in my own place, I briefly considered bankruptcy. The problem with this, as far as I can tell, is that I used to jointly own a flat with an ex-girlfriend, with whom I have a young daughter (it's mostly because I want to have savings to support my daughter fully that I want to be debt-free). Although I moved out in 2006 and haven't paid anything towards the mortgage since 2007, my ex still lives there with my daughter. We didn't legally transfer everything over to her name until late 2011, so when I looked into bankruptcy, I was told there was a strong possibility my ex would be hit with a possibly substantial bill. I can't have her negatively affected by my stupid mistakes, and I can't risk my daughter's home, so I'm assuming bankruptcy is not an option for me.

My parents have offered to pay the balance of the Barclaycard off. I'll obviously need to pay them back instead, but they have told me they do not expect interest for this. So my plan, such as it is so far, is to have them clear this card for me, set up a standing order to pay them back each month, then see if I can find another interest-free card to transfer the balance of the Virgin card over to. Obviously at over ten grand, I might struggle to find such a card, but still.

The Lloyds loan will be repaid within around 18 months - 2 years now, so I'm less worried about that. As for the overdraft, I just need to do what I can to get out of it.

I have a final interview on Tuesday for a new job that pays slightly more and has a slightly cheaper commute, so naturally I have my fingers crossed for that! :-)

So, should I stick with my plan of trying to get my cards interest free and paying what I can? Or should I consider taking out a big loan to pay everything off, where there will be an eventual end point? Or something else?

Many thanks, I'd be grateful for whatever advice anyone can offer!

Former_StepChange_Laura

Zio wrote: »

Hi guys!

I'm really very new to the forum and haven't had a chance to do much reading, but I'm in quite a bad situation debt-wise and it's been going for many years now. I need a permanent solution to sort my debts out.

Despite being in my mid-thirties, I'm currently living with my parents. I moved back in last December in an effort to really sort out my debts, but problems at work have prevented me making the progress I was hoping for (my job role moved unexpectedly, so I have an incredibly expensive commute that the extra pay they gave me doesn't really cover).

Okay, so my debts then:

- I have a £3,000 overdraft with Lloyds which is normally pretty maxed.
- I have £5,000 remaining from a £16,000 Lloyds loan I took out in August 2009.
- I have approximately £7,500 balance on a Barclaycard which is reaching the end of it's interest free period.
- I have approximately £10,500 balance on a Virgin MBNA credit card which has now reached the end of the interest free period.

So about £26,000 - £27,000 total.

I guess really I'm wondering how best to tackle it all. Thanks to my parents letting me stay with them and the fact I earn roughly £28k salary now, things are not in a total crisis. I can afford to make my minimum payments every month, pay child maintenance and my necessities and still have a little left over. This is probably going to sound very callous and selfish considering what other people must be going through, but I'm just fed up of years of just getting by and not having any savings or anything. All this debt has hung around my neck since around 2007 or so.

When I lived in my own place, I briefly considered bankruptcy. The problem with this, as far as I can tell, is that I used to jointly own a flat with an ex-girlfriend, with whom I have a young daughter (it's mostly because I want to have savings to support my daughter fully that I want to be debt-free). Although I moved out in 2006 and haven't paid anything towards the mortgage since 2007, my ex still lives there with my daughter. We didn't legally transfer everything over to her name until late 2011, so when I looked into bankruptcy, I was told there was a strong possibility my ex would be hit with a possibly substantial bill. I can't have her negatively affected by my stupid mistakes, and I can't risk my daughter's home, so I'm assuming bankruptcy is not an option for me.

My parents have offered to pay the balance of the Barclaycard off. I'll obviously need to pay them back instead, but they have told me they do not expect interest for this. So my plan, such as it is so far, is to have them clear this card for me, set up a standing order to pay them back each month, then see if I can find another interest-free card to transfer the balance of the Virgin card over to. Obviously at over ten grand, I might struggle to find such a card, but still.

The Lloyds loan will be repaid within around 18 months - 2 years now, so I'm less worried about that. As for the overdraft, I just need to do what I can to get out of it.

I have a final interview on Tuesday for a new job that pays slightly more and has a slightly cheaper commute, so naturally I have my fingers crossed for that! :-)

So, should I stick with my plan of trying to get my cards interest free and paying what I can? Or should I consider taking out a big loan to pay everything off, where there will be an eventual end point? Or something else?

Many thanks, I'd be grateful for whatever advice anyone can offer!

Hi there,

Thank you for your message and welcome to the forum. I’m sorry to hear you’re feeling fed up, but you’ve come to the right place to get the free debt help you need.

We wouldn’t usually recommend taking out a debt consolidation loan as they often can make your situation worse. For example, although the monthly payments may be more manageable, your unlikely to get a loan at a good interest rate – that will mean you could end up paying back much more money in interest over a longer period. This blogpost explains a bit more about why debt consolidation is unlikely to be the best solution.

You also mention that you looked into bankruptcy but aren’t sure if it’s right for you. It’s difficult to work out what your options are without looking at your situation in more depth, so I’d suggest using our online Debt Remedy advice tool. Debt Remedy will look more closely at your circumstances and provide a personal action plan with clear recommendations about solutions that are specific to you.

Alternatively you could speak to one of our advisors, who will also be able to discuss your options with you. You can ring our Helpline for free on 0800 138 1111 (it’s also free to call from mobiles). We’re open Monday to Friday 8am to 8pm and Saturdays 8am to 4pm.

I hope this helps!

Thanks,
Laura