About to start a DMP - give me the cold hard facts please.

lizzy23

Hatecreditors.com wrote: »

Honestly you won’t look back!
When I started my DMP with £45k of debt (yes, you read it right £45,000) I started a DMP purely as a way of getting my monthly payments down in order to live. I never thought the debt would reduce and I would live with it forever. 3 years later my balance is £15k!

You’ll be amazed at how much the debt reduces once you start your DMP and just chip away at it.

I actually had my light bulb moment in my first year of the DMP, realising that you can actually still live on a budget and my focus changed from ‘let’s just keep paying the minimum payment for now’ to ‘I want rid of these debts as soon as possible’.

So when it came to my annual review I kept everything low on my budget and tried to pay as much into my DMP as possible.

Good luck.

i agree with this, but one piece of advice i would give is put everything in your budget to the max, for instance i don't smoke, i do on my budget, it gives me free cash to squirrel away in an emergency fund, hair cuts, perscriptions, entertainment are all at the maximum allowed by Stepchange, what i have found on my DMP is that for the first time in perhaps 20 years i have a bit left at the end of the month, and i actually have a life, yes the old credit rating is trashed, yes if i carry on at my current repayment level it will take approximately 8 years( it won't as i will be able to up repayments) but at the end of the day if we had carried on as we were, the debt would have got bigger and bigger and bigger and would never have been paid off, the only worry i have is in the future when we have to replace vehicles, hubby is self employed and needs his van, and i do a 40mile round trip, but we'll get round it somehow.

Good luck and stick around

startingtogetoutofdebt

I started on a DMP with Stepchange last year. I agree with comments made earlier make sure you include everything possible in your budget so that your payments allow you to live.

Although you might want to put down just the exact amount you need each month its worth adding more to your budget so that although it might spread the plan over a longer period you will at least have spare money each month for the odd treat or to save for emergencies etc - 9 years is a long time to live on a really tight budget.

The other thing I'd say is be prepared for lots of letters and phone calls to begin with. I'm still getting calls from one of my creditors who are denying receiving any correspondence from Stepchange. All the others have accepted the terms of the DMP and terminated my agreement with them which means that as long as I stick to the terms of the DMP and they receive the agreed amounts on the agreed dates no interest or charges will be added to the account. Some of the letters you'll receive can seem quite intimidating but I'd recommend reading all of them and being polite but firm with companies when they ring.

Stepchange are great as well I've rang them today to tell them about the creditor claiming not to have received anything and they've sent it off to them again today.

Your credit rating will be wrecked but if you carry on adding to your debts it will be wrecked eventually anyway. This was one of the biggest factors to me though as I have a mortgage that I know once my fixed rate ends I won't be able to move onto a new deal because of my credit rating but it's still one of the best things I've ever done and it's made me really look at my whole attitude to money.

The other thing is make sure as well that your bank account is completely independent to anyone you owe money to - its amazing how many companies each bank owns - you need to bank with one that isn't linked in anyway to a company you owe money to.

Good luck with it!