1 year into DMP. £8900 cleared. My journey so far.

Getmeoutofdebt

Well, in two days time I will have completed my first year on my self managed DMP! It has flown by! I have had some ups and downs but for most of the time it has been surprisingly easy and I wish I had done it years ago.

I have managed to clear £8900 off my debt (£2k was written off by MBNA the rest I paid) bringing it down to £18999 which is still a long way to go but if I can keep it up I could do it in just over 2 years.

I decided to write this entry to help those starting out. I have searched endlessly on here for people a little further down the line than me to see what lies ahead and what to expect but I struggled to find people in the same situation on a self managed plan. I decided then to share what I have found out / done so that other people looking for help might get some good ideas and also see that its not as scary as you think its going to be when you first start out on a plan.


Things I learned along the way.....
Creditors seem to be more accepting if you are self managed. I tried going through a company years ago and it was a disaster. The creditors have been very good to me now I'm dealing with them myself and National Debtline and their Cashflow programme have been a great back up. The creditors seem to take you more seriously with the back up from Cashflow.
The thing I was most worried of when starting out was being chased, telephoned or taken to court, but so far this has not happened. National Debtline taught me that as long as you are making a reasonable monthly offer and paying on time you will be fine. You can't pay any more than you can afford and the creditors have to pay costs to take you to court and all the court will do is tell them to freeze interest and work out a repayment that you can afford, which is what you are asking them anyway!
Debt collectors are not that scary! They have no rights to come and take anything from you. They buy your debt for next to nothing then try and make some money off it by collecting a bit more than they have bought it for. My friend is a debt collector. He put my mind at ease no end. He says they buy debts of thousands just for a few hundred pounds. Most cases they will accept a settlement offer from you if it covers what they bought the debt for. So if your debt gets sold on to a debt collector it could work out to be a positive thing rather than a negative! So far none of mine have been sold on. MBNA would have been the first to sell but they settled with me themselves instead. Probably for more than they would have sold it for.
Do everything in writing!! Keep everything sent and received in a file! You need proof of everything. Creditors can and will go back on their word. Don't agree to anything over the phone.
Make a spreadsheet showing money paid, interest charged, current balances etc. It helps to keep you motivated and see where you are at.

You have to be determined to succeed. It's hard at first but once you get in the right frame of mind it gets easier. Economise on everything and ask "Do I really need this?" if you get the urge to spend.

Plan ahead! Every Sunday I write out a meal plan for the week ahead and a shopping list. I get recipes from BBC Good Food online, they have some really good ones that are cheap to make. I try and work the week so that I am using the same ingredients more than one day to save on costs. I only look for, and buy , what is on my shopping list. No extras!
Plan ahead for things like Xmas (I save all my £2 coins in a jar) and for family weddings, car tax etc.... whatever may be coming up in the next few months (I put away any left over shopping money in another jar) You may not save enough to cover it but to have some money put aside is a great help.
I ask for basic things I need for xmas / birthdays. If I need new tea towels they go on my "what to ask for at xmas" list. That way you are getting other people to buy it and you know you're not going to end up with a load of rubbish you don't want at xmas.'

Ebay & Surveys. I Ebay everything! I went through the whole house at the start of my debt plan and if I hadn't used it, worn it, appreciated it in the last 6 months it got sold. (I have missed nothing and made lots of cash!) Then I moved on to selling things for friends at a commission. I've had people more than happy to offload their junk on me if it means me splitting the income with them. Even if it looks like junk try it. I have sold rusty keys for a fortune! People want things for all sorts of reasons, they collect odd things, need something for an art project... I've sold things I'd never have dreamed would sell!
I also do online surveys with My Survey and Opinion Outpost. You need to be patient with these and it can get a bit boring but it does add up. I transfer the My Survey credits to my Nectar card and with my points over the year (combined with nectar points from shopping & fuel) I buy my christmas food shop. Opinion outpost lets you transfer money into your paypal account which is handy.

How my creditors have treated me.....
MBNA credit card; Froze interest straight away, accepted my reduced payment bringing my monthly payment down from £119 to £57. After 10 months they warned me I was due to default in 2 months and offered me a reduced settlement offer or a fixed payment plan. I settled for £2k less than what I owed them.

Yorkshire bank Visa; Froze interest and accepted offer of monthly payment reduced from £117 to £83 (I owed a lot more on this visa than the others) They rang me after 3 months asking for an update. I posted them a letter saying I was in the same situation but thanked them for their help and asked for longer. They gave me another 6 months and wrote asking for another update. I posted off another letter & financial statement and offered an extra £3 a month. I got no reply but my latest statement shows they have accepted my new offer as my monthly payment.

Barclaycard; I have two cards with them due to the taking over my Egg card, Reduced interest to 2.5% so I'm paying £9 a month on average and they reduced each monthly payment by about £50 per card. I have had no contact from them at all. I even wrote to them after 10 months when I got the offer from MBNA to see what they planned to do with my account after the first year was up (defaults, selling on to debt collectors etc) and they just said they would get back to me but they didn't and nothing has changed.

My overdrafts and catalogue were smaller debts so I didn't contact them regarding my debt plan. I used them as something I could pay extra off if I wanted, by using Ebay earnings etc. I'd heard that once you are on a debt plan if you pay extra off (particularly Barclaycard) they decide you can afford it after all and put your interest back on. With my catalogue I got commission every time I paid something off so I saved the commission until I could buy something then sold the item I'd bought on Ebay and payed the money back off the catalogue.
I had paid them all off until I got the settlement offer from MBNA and then I had to use my overdraft to pay it. So now I owe on the overdraft again but it saved me £2k so it was worth it.

At the moment I am trying to pay off my overdraft again and then after that I plan to save my ebay money in my paypal account (I don't want it in my bank in case creditors can tell its there) I want to be in a position where I have something to offer if I get any more settlement offers. I doubt I will raise enough but I have to try.

So..... thats my first year in a nutshell. Hopefully anyone reading it may have found something of use in there. Fingers crossed this next year is as easy and successful. Good luck to you all reading this with your own debt busting plans

eyeopener2

Great post and well done on the progress so far. You will be free before you know it.

poledancer49

Well done...you have every right to be proud of yourself. I found your comments very interesting and I'm sure others will too. Good luck in your next year.

zenboo1978

Wow, I have only just recently got my credit report and I am working my way through sorting out my debts. I have a similar amount to what you have cleared off that need paying and sorting. This has definitely helped me get motivated. It can be incredibly daunting to make the first steps. There are some brilliant tips to get organised in your post. Well done and thank you for your post, it certainly will help me

amr547

Fantastic, well done!

Issuma

Getmeoutofdebt........Well Done, like you I self manage my own DMP and last year cleared just over £10k and my experience has been very similar to yours, I haven't really had any hassle from any of my creditors, I have learnt along the way what works and what doesn't with them and what I've found works is:

Keep calm, expalin your situation, be polite and don't let anyone bully you.

Don't agree to anything that you won't be able to stick to.

When you have your reviews if you can increase your payments a little then do but if you can't then dont - don't let then pressurise you.

Try to keep contact written not verbal.

If you're having problems making the payments contact them, I think a mistake a lot of people make is coming to an agreement then not sticking to it.

Keep up the good work.

Getmeoutofdebt

Thanks for all your comments everyone! I really appreciate them x

Sweetpea84

Thank you for posting this message, It gives me such hope to see what progress you have made in 12 months! x

Time_to_face_the_music

Truly inspiring post, very useful and motivational. Very well done on your debt busting so far :T

We started our DMP with CCCS, now StepChange, but moved to self managed about 9 months down the line. If I had known then what I know now, we would have gone self managed from the start but for anyone who needs a start-up and hasn't got the nerve to go it alone from the beginning, StepChange are fine and, most importantly, free.

Every time I earn extra money, no matter how small, by selling on ebay or Amazon or doing some overtime etc, it goes straight off an interest charging debt. I joined the payment a day or PAD challenge and I make sure I really do make a payment every single day.

In 13 months, we have paid £23,579 off our declared debt plus cleared extra undeclared BNPL debt of £1050. We thought this debt was with us for life, we would take it into retirement and possibly to the grave. Just one year has shown us how different life can be.

For anyone considering a DMP, please take advice from Getmeoutofdebt's excellent post. You can do this too

katy_ann

Congrautlations, you've done so well! Keep up the hard work sweet! x

abundant1972

Thanks!!!

A brilliant post with some great advice... I've been paying debts off via CCCS/Step Change for about a year and they have been fantastic. The only downside is extra cash gets split pro-rata - so you can't dictate which debt you want to over pay into... Not so bad with me, as I got them all frozen at zero interest... but not good if one charges higher interest rates...

The idea of shopping lists is good - but alien to me!!! I'm not the World's greatest cook - and can be lazy. I'm on my own and when I get in from work am often too tired to think about anything complicated... Have started making meals on my day's off and freezing which helps. Will check out the site you mentioned and look up some recipes.

How do you stay motivated? Upbeat? I think that's my hardest challenge... I am ploughing a lot into my debts but I just feel like my life is empty and that it's all about my debts. I know if I go out and party it will take longer... I suppose the end just seems a long way off right now - even though am hoping to be debt free by the end of the year...

Thanks again for the post!