DMP & Mutual Support Thread - Part 9

owenmonicapeter

I have been lurking for a while now. My husband and I are on a DMP with Step change, have been for 10 months now. (was previously with payplan)
Debts at the start were just short of £26k and as of this months payments will be just below £18k.
We have cleared 8k in 10 months so far between the DMP payments and have made full and final settlements that cleared another 5.5k but only paid approximately half that!


We initially got into debt in 2008 when our middle son was born disabled, it spiralled out of control and by 2009/2010, I alone had a CCJ (now settled) and 13 defaults. My husband only has two defaults. So we started with a DMP.


It was slow to start with but we are much more committed now and are determined to become debt free (current date is sitting at July 2020) through our DMP and hopefully some more full and final settlements to bring down the length of time overall.


I do have an old debt from 1999 that went to CCJ in 2000 (Discovered this in 2009) with an ex partner that haunts me a lot but I am struggling to find out exactly what is owed as although the judgement was for £4200, the original agreement was entitled to interest but I have never been notified officially of what has been added, when, why and the rate of interest, just the DCA telling me what it is years later. They only send me a statement of account now but I worry that one day it may resurface and I won't be able to afford a solicitor to help me!


I worry so much about a creditor making me bankrupt, getting more CCJs that lead to charging orders/order of sales!


We are desperately trying to get each creditor down below £1k so that won't be an option and we have my Mum who said if it ever got that desperate she would do all she could to help.


I have developed severe anxiety over everything which does effect me on a daily basis and have been prescribed anti-depressants, I worry that any serious court action would tip me over the edge!


I am happily married and we have 5 children, we both work and I am a full time student at Uni, we just want to repay our debts and provide for our children's future. We live within our means, are frugal with our money and I am pretty good at bargain hunting! Our debts did not come from reckless spending, they came from an unforeseen personal trauma when our son was born and then robbing peter to pay paul scenario!


Sorry for the long essay, feels good to get it all out!


Hope to get to know some of you x

Everoptimistic31

Thank you TTFM and Sazzie. It makes such a difference to be able to sound friendly and supportive people out about these issues. It really stops me from spiralling into despair and reminds me that I'm far from alone on this journey.

I have cancelled my direct debit for this month, sent StepChange an email and will also contact them first thing on Tuesday to ask that they recommence from next month.

I have also written the follow-up letter to my creditors which I'll send later in May, does it seem ok?

Dear Sir / Madam,

Re: account number: 4929 **** **** ****

I wrote to you previously on 20th April, 2014 (letter received 26th April, 2014) to advise you that I was unfortunately in financial difficulty.

I also advised you that rather than filing for bankruptcy I am committed to paying back my creditors. To this end, I have set up a Debt Management Plan (DMP) to be administered by StepChange. My client reference number is *******.

Due to unforeseen circumstances, the first payment from StepChange will actually be made to you on 25th June, 2014 and not the 25th May, 2014, as I previously advised. Please accept my apologies for this, along with my assurance that larger regular payments will commence monthly from the 25th of June thereafter.

In the meantime I will ensure that a token payment of £1.00 is made towards my account for the month of May.

I’m also aware that StepChange are negotiating with my creditors to freeze interest on my account; however, I have not been notified of whether you have agreed to this. In recognition of my commitment to paying back the sums owed to you as opposed to filing for bankruptcy I would like to reiterate my request to you to consider freezing interest on my account for the duration of my DMP. I would also be grateful if you could withhold future charges and refund any applied over the last 56 day period.

This will allow me to pay back the sums owed to you within a reasonable period of time, rather than being pushed towards insolvency which would be a sub-optimal solution for us both.

Yours faithfully,

Everoptimistic31

Hopelessly_Hopeful

Everoptimistic31 wrote: »

Hello all,

After much agonising I have finally taken the plunge and set up my DMP with StepChange. The pretence that everything would be ok had gone on far too long and the way I saw it, I was crippling myself with the illusion that as long as I could somehow keep making the minimum payments on my cards everything would be ok.

As a single person I now have £61,000 to pay off. Just writing it down feels quite unbelievable.

I have read this thread from start to finish and it's been absolutely phenomenal. So many contributors but Hopelessly Hopeful and Time To Face The Music in particular - thank you.

However, before my first payment is even due to leave my account I have a problem. I had been putting off root canal treatment and it was making me more and more ill; finally I couldn't hold it off any longer and had it done on Friday.

The terrible thing is that this means on the very first month I was due to make my first payment to StepChange (£638) I actually have less than £100 that I can give them.

I am worried sick because a direct debit has been set up to take the money and it's due on 10th May. Because it's the bank holiday I can't get hold of them to ask what to do. I'm thinking I should cancel the direct debit for this month only and send StepChange an email explaining. Perhaps I should also send my creditors a letter telling them why I've failed from the start to make my reduced payment?

I hope so much that there are no further emergencies next month and I can just get on with making the full payment but right now I'm just worried about the impact of falling at the first hurdle.

Have any of you longer-termers got any advice?

Welcome

Thanks for the kind words but we just try to give something back. I will always be grateful for the practical and emotional support this thread gives me. I think everyone has something to offer and its amazing through sharing how much we learn and become more empowered and confident.

Things go wrong from time to time. I'm with Ms TTFTM, call stepchange and make token or reduced for a month or two.

Good luck with it.

HHx

Hopelessly_Hopeful

rokat wrote: »

Hi,

Ive never commented on this thread before but have read it a lot and it was one of the reasons I started my DMP in December so Thank you!

Have a quick question for all you lovely people.

From the end of May I will be getting about £250 more each month due to a promotion. Could I save up this extra money and begin making F&F offers to my creditors or do I need to tell Stepchange about it and increase my DMP payments?

If creditors accept offers less than the full amount it'll obviously bring my DFD closer which would be better for me

Welcome

Technically the answer is you should tell them and they should fairly distribute it according to the original criteria. However; creditors don't all play fair and SC will not intervene and sort them out when they don't. So if I were in your shoes I'd squirrell it into the emergency fund and when you have a good chunck so you can either pick the ones off that are charging interest or ask for F&F.

HHx

Hopelessly_Hopeful

owenmonicapeter wrote: »

I have been lurking for a while now. My husband and I are on a DMP with Step change, have been for 10 months now. (was previously with payplan)
Debts at the start were just short of £26k and as of this months payments will be just below £18k.
We have cleared 8k in 10 months so far between the DMP payments and have made full and final settlements that cleared another 5.5k but only paid approximately half that!


We initially got into debt in 2008 when our middle son was born disabled, it spiralled out of control and by 2009/2010, I alone had a CCJ (now settled) and 13 defaults. My husband only has two defaults. So we started with a DMP.


It was slow to start with but we are much more committed now and are determined to become debt free (current date is sitting at July 2020) through our DMP and hopefully some more full and final settlements to bring down the length of time overall.


I do have an old debt from 1999 that went to CCJ in 2000 (Discovered this in 2009) with an ex partner that haunts me a lot but I am struggling to find out exactly what is owed as although the judgement was for £4200, the original agreement was entitled to interest but I have never been notified officially of what has been added, when, why and the rate of interest, just the DCA telling me what it is years later. They only send me a statement of account now but I worry that one day it may resurface and I won't be able to afford a solicitor to help me!


I worry so much about a creditor making me bankrupt, getting more CCJs that lead to charging orders/order of sales!


We are desperately trying to get each creditor down below £1k so that won't be an option and we have my Mum who said if it ever got that desperate she would do all she could to help.


I have developed severe anxiety over everything which does effect me on a daily basis and have been prescribed anti-depressants, I worry that any serious court action would tip me over the edge!


I am happily married and we have 5 children, we both work and I am a full time student at Uni, we just want to repay our debts and provide for our children's future. We live within our means, are frugal with our money and I am pretty good at bargain hunting! Our debts did not come from reckless spending, they came from an unforeseen personal trauma when our son was born and then robbing peter to pay paul scenario!


Sorry for the long essay, feels good to get it all out!


Hope to get to know some of you x

Welcome

Sounds like you have a lot on your plate and are coping very well under the circumstances. Sorry to hear about the anxiety. I think you should keep looking at what you have achieved and not just whats left to achieve because you have done really well.

CCJs are very rare, especially if you keep up repayment. No creditor wants to make you bankcrupt, it costs them and it would mean they wouldn't have little chance of seeing their money. Likewise it is costly for them to pay for the CCJ. In the unlikely event CCJ did come along( you will see how rare that is from this thread) judge will likely find in your favour and demand they stop/refund interest.

Debt is not a crime and they cant have what you don't have.

Re the old debt who is it with and what are they saying?

HHx

Hopelessly_Hopeful

Everoptimistic31 wrote: »

Thank you TTFM and Sazzie. It makes such a difference to be able to sound friendly and supportive people out about these issues. It really stops me from spiralling into despair and reminds me that I'm far from alone on this journey.

I have cancelled my direct debit for this month, sent StepChange an email and will also contact them first thing on Tuesday to ask that they recommence from next month.

I have also written the follow-up letter to my creditors which I'll send later in May, does it seem ok?

Dear Sir / Madam,

Re: account number: 4929 **** **** ****

I wrote to you previously on 20th April, 2014 (letter received 26th April, 2014) to advise you that I was unfortunately in financial difficulty.

I also advised you that rather than filing for bankruptcy I am committed to paying back my creditors. To this end, I have set up a Debt Management Plan (DMP) to be administered by StepChange. My client reference number is *******.

Due to unforeseen circumstances, the first payment from StepChange will actually be made to you on 25th June, 2014 and not the 25th May, 2014, as I previously advised. Please accept my apologies for this, along with my assurance that larger regular payments will commence monthly from the 25th of June thereafter.

In the meantime I will ensure that a token payment of £1.00 is made towards my account for the month of May.

I’m also aware that StepChange are negotiating with my creditors to freeze interest on my account; however, I have not been notified of whether you have agreed to this. In recognition of my commitment to paying back the sums owed to you as opposed to filing for bankruptcy I would like to reiterate my request to you to consider freezing interest on my account for the duration of my DMP. I would also be grateful if you could withhold future charges and refund any applied over the last 56 day period.

This will allow me to pay back the sums owed to you within a reasonable period of time, rather than being pushed towards insolvency which would be a sub-optimal solution for us both.

Yours faithfully,

Everoptimistic31

Looks good. Rather than just unforseen circs id add in the detail of your root canal and tell them you attach a copy of the receipt. Id also ask for contact only in writing.

Good luck

HHx

owenmonicapeter

Hopelessly_Hopeful wrote: »

Welcome

Sounds like you have a lot on your plate and are coping very well under the circumstances. Sorry to hear about the anxiety. I think you should keep looking at what you have achieved and not just whats left to achieve because you have done really well.

CCJs are very rare, especially if you keep up repayment. No creditor wants to make you bankcrupt, it costs them and it would mean they wouldn't have little chance of seeing their money. Likewise it is costly for them to pay for the CCJ. In the unlikely event CCJ did come along( you will see how rare that is from this thread) judge will likely find in your favour and demand they stop/refund interest.

Debt is not a crime and they cant have what you don't have.

Re the old debt who is it with and what are they saying?

HHx

The debt was with first national and now asset link. They have only sent me a statement of account since 2009, I worry they are biding their time to add on huge amounts of interest!

Hopelessly_Hopeful

owenmonicapeter wrote: »

The debt was with first national and now asset link. They have only sent me a statement of account since 2009, I worry they are biding their time to add on huge amounts of interest!

It's unlikely they will start adding interest at this stage unless they say you are no longer in financial difficulty. If this does happen you will be able to challenge them and then appeal to the FOS.

Most of what we worry about never happens.

Hope that helps

HHx

rokat

Hopelessly_Hopeful wrote: »

Welcome

Technically the answer is you should tell them and they should fairly distribute it according to the original criteria. However; creditors don't all play fair and SC will not intervene and sort them out when they don't. So if I were in your shoes I'd squirrell it into the emergency fund and when you have a good chunck so you can either pick the ones off that are charging interest or ask for F&F.

HHx

Thanks Hopelessly Hopeful!

alyxzandra

Our DMP has been going on well for the past year. Paid off quite a bit and getting ready to pay off another creditor. My 5 year old son is now receiving DLA and we will not use it to pay off our debts. Instead, it goes into a savings account and it is his money. Our creditors get a good sized chunk and when we have extra money we pick off the smaller creditors to pay off.

Our debts at the highest was over £60,000! And what angers me is that it was not due to us spending willy nilly. We started out having a substantial savings and very little credit card debt. I had credit cards, but all with zero balances except one that I used for trips overseas and would just pay off. And then all hell broke loose in 2009. We went to build an extension using our savings and cowboy builders messed it up and left us with depleted savings and an extension that had to be rebuilt. All went on credit cards. At the same time I had to shell out £20,000 to help my disabled mother hire a solicitor in order to protect her from an unscrupulous person who was trying to take everything from her.

Between the 10 grand already on my card, the 30 grand for the extension and then the 20 grand for my mother, we found ourselves owing 60 grand between loans, credit cards and overdrafts. And also owing money to friends. The 10 grand we could handle as we make over 50k, but the rest? No way. Then, I had 2 car accidents in a month where both cars were written off. As we did not get enough of a pay out to buy a decent car (they were very old cars), we had to borrow money from my in-laws. And wound up buying a lemon that has cost us a fortune! It is now all fixed, but still.

For several years we made minimum payments and lived off the overdrafts. I tried to convince my husband in 2011 to go on a DMP, but he was completely against it. He finally woke up in September 2012 when we had no money left in the overdraft just after we got paid. I had to force him into it, but he has seen we have been able to get the payments down. Once everyone is paid off we are looking to pay off our mortgage, which is not very high. And we have a lot of equity in our home. I guess in some ways we are lucky.

As for the cowboy builder, we are now in contact with someone else who he ripped off. And there are 2 other people. We are going together to Trading Standards as when we approached individually, we were rebuffed. He took about the same money from them as from us. And he also screwed over a business partner. I have waited for years to get this person brought to justice. And now it seems it is going to happen! We will not get our money back, but we will try to stop him.

We have been lucky with our creditors. When we started with the DMP we were not behind on anything. I never missed a council tax or mortgage payment and have still never missed one. All stopped interest except for 2 who have added a very small interest, but the payments we make are much higher and it does not add up to much. One is about £5.50 a month and we are paying over £35 a month on it. One added £100 immediately on a £500 debt, but they have now reversed it. Another added £400 on a £499 debt and it is now with the FOS. At the end of the month another small creditor is getting paid off. And we are paying off two others by October.

We are due to be done with the DMP by June 2019, but we plan on getting paid off in early 2018. It is a long and hard road, but I recommend going on a DMP. We've had a few hitches along the way, but it has all worked out in the end. For anyone starting out, I found the first year a bit hard, but it is now going along smoothly.

To save money, we are growing our own fruit and veggies. And I enter competitions and have won a lot of things for the garden. I recently won something I found out I cannot use and will put it up on Ebay. We also sell unwanted things at car boots and buy toys to sell on Ebay. This has helped to supplement our income.

There are some great long term DMP like TTFTM who have helped me. And the support here has been fantastic. If it was not for this thread and the advice, I am not sure I would have gone on a DMP as I did not know about it until I came here. There is light at the end of the tunnel!