The problem with DMPs....

Stewart_78

My wife and I are both in DMP's with payplan and it's going OK. The problem is that we never feel like we are getting anywhere. Mine has about 24 years to run but I'm hoping to get a settlement figure together in the next few years and knock it on the head.

The annoying this is that we are dealing with quite a lot of smaller debts of a few hundred quid and I often think it would be great to just clear those. But Payplan says we must spread all monies equally.

I have heard of people making FF offers to each creditor in turn, starting with the biggest. Say I did this and the first one accepted, are all the rest going to get annoyed? They should be happier as I could then offer the remaining ones more per month.

What I would like to do is reduce the amount of creditors we have over time.

My wife for instance has one debt of £180 which is currently on about £1.40 a month as a pro rata part of her payment. We could probably just clear that now, we couldn't at the time. Or we could offer them £100 or something. What will happen if we do this?

Deep_In_Debt

I've done it a lot on my DMP with Stepchange with no problems at all and none of the creditors got the hump and neither did StepChange. I clear the smaller ones on F&F (I can't afford to do the larger ones and just manage to save enough for a small one).

National Debtline website has a good template letter you can use for this. I'd just go ahead and write to the creditor and then let Payplan know when you've cleared it.

I'm sure that the creditors would rather get most of their money back sooner rather than waiting years for it to be paid off.

Good luck.

Stewart_78

Thanks for that. I actually doubt if they would even notice to be honest. I might try clearing off a few and see what happens!

bargainbetty

Remember that if you clear a debt, the money for that each month has to then be spread between the other creditors, even if it works out as pennies. It does bring your debt down that tiny bit faster each time though...

Personally, I'd start with one creditor. Say that you have been offered the cash on the understanding that it is used to clear a debt in full, and you would need it to be marked as a full and final settlement. Get this agreement in writing before you hand over any money at all.

Good luck!

DS4215

When making F&F offers start low and work upwards. You might be lucky and get accepted at 25%, but if you aren't you can go upwards...

National_Debtline

Hello there,

Here's our Full & Final settlement fact sheet:
http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=24_full_and_final_settlement_offers

A quick question, are you in rented or mortgaged accomodation? If it's the latter do you have equity within the property?

Best wishes,

David @ NDL.

Stuh

I am doing exactly that with paying off my smaller debts then will tackle the larger ones at a later stage. I informed Payplan of my intentions and have started off at 35% with each creditor and nearly all of them come back with a counter of 70%+ immediately so i then (after advice on here) increase my offer by 1% if this is refused i move along to the next one informing them of my intentions, and if the offers were refused then back to the DMP arrangement and onto the next creditor, so far all have been ok with me and i have managed to sort Capital One for 50% and NCO Europe for the same % some other have had better success but i am happy with this! All accounts are defaulted so once the 6 years is up (later in 2013) all info including the "settled" marker on the file will drop off so it should be cleaner thank god!! Hope my advice helps! Cheers Stuh

Stewart_78

Thanks all. David, I own my house with approx £130k equity. If I could re-mortgage it all away I would!

dancingfairy

Have no idea why you'd be doing a 24 year dmp? that doesn't sound right. I'm sorry but I don't think creditors will necessarily entertain a settlement - why would they when they can take you to court, get a CCJ and get a charging order. the only reason would be for cash flow purposes and the old 'bird in the hand is worth 2 in the bush saying'. Worth a try though I guess.
Why are you not on an IVA? on first glance this would seem like it might be more suitable for you?
df

Newchapter

If there's equty in my property (although there's hardly any!), is it likely I will be taken to court and given a charge order?

Thanks

National_Debtline_representative wrote: »

Hello there,


A quick question, are you in rented or mortgaged accomodation? If it's the latter do you have equity within the property?

Best wishes,

David @ NDL.

RAS

Possible. is it a jointly owned property? Are the debts in one name or both?