im not waving im drowning

Bella_Smythe

can i just ask how it would work, both CAB and Stepchange have recommended BR but unsure how to proceed. Have house in negative equity and some mortgage arrears, am in a DMP plan for about £37,000 which is barely getting paid off because i only have £13 a month surplus income. I also ran up some catalogue debts after taking out DMP. the catalogues i already had but had paid them off so didnt include them in the DMP, then they sent me emails with special offers and money off vouchers and unfortunately i thought I'd just get some christmas presents (year before last), them needed some work shoes and clothes and unfortunately it just escalated. will i get in trouble for running up catalogue debts after taking out DMP? i didnt actually apply for any catalogues? also how would i go about BR with a DMP already in existence. DMP is with payplan and have annual review next week - they keep suggesting i convert DMP into an IVA to pay off in five years but the others (CAB and stepchange) said BR would be better, partly due to negative equity. Payplan said sell the house then put shortfall into IVA but houses in our area not selling, also in bad state of repair as havent been able to afford to keep up with maintainance?

PippaGirl_2

It does seem as if BR would be a good option for you, it would give you a new start and end the hassle. The forms can be downloaded and then be completed. From what you say as your surplus is so little you main problem will be raising the fees to go BR. Even if you stop paying your creditors, at £13 a month that is going to take years. Have you looked at the charities that help? Do you have a way of raising the fees? The arrears on your mortgage won't be included on the BR if you plan to remain in your home as BR only covers unsecured debt.
I doubt very much if the OR would even mention the new catalogue debts, I wouldn't worry about it.
Do put up an SOA here though and people can advise what can be increased or what would need to be cut back on.

Bella_Smythe

thanks Pippa. although the mortgage is in arrears we are paying it - interest only £560 per month. as im not bothered about keeping it i thought i could not pay it for a few months to raise BR fees? from what ive read on here most BS are not exactly in a rush to repossess when theyre neg equity so i think we'd be ok doing that. we intend to private rent.

PippaGirl_2

Sounds like a plan Bella.

Bella_Smythe

Bump. thanks Pippa. anyone else got any advice for me (particularly stepchange/cccs people on whether i get in trouble for running up catalogue debts while already in a dmp?)
Thanks

fiveyearplan

I wouldn't worry about the catalogue debt but would suggest you don't use it anymore.

fiveyearplan

Do you have a joint mortgage, if so are both of you planning BR? Will you be able to rent cheaper than your mortgage? It might be an idea to keep the house for the moment as you can always add it to you BR at a later date (if you are both going BR). If it is a joint mortgage and only you are going BR then your partner will become liable for full debt.

Bella_Smythe

we are both planning to go BR. we have a joint mortgage, paying interest only, probably £100 to £150 more than we could rent for in this area (its 3 bed, we only need one or two). above all, dont want to go through all this and then later get house (beneficial interest or whatever it is) back to us and become responsible for neg equity again. also have lost heart in the place and dont really want to stay here? what would be the advantages to staying here? Thanks.