still charging interest even thou on dmp

pippasdog

hi guys a friend of mine has been on a dmp now for a good six months she contacted ccs who organised a dmp for her , she hasnt missed a single payment however she recently received a statement from one of her creditors (i think its called very ) who have still been charging her interest she contacted ccs /step change who have informed her that some companies will refuse to cancel interest and that she should contact the company herself which consquently she did, to be told that instead of charging 35% interest they have reduced it to 15% and she should be thankfull they have done that . she again contacted ccs who told her to contact the financial ombudsman , which she has who have informed her they will write to the company asking them to cancel the interest but they cannot enforce it . my question being the fact that she is on this dmp (for the next 10yrs not taking into account the more interest being charged ,dept to that company was approx £500 now increased to approx £800 ) she will be paying it off forever what would you guys advise her to do ? i thought ccs /stepchange sort all this out in advance and should there be any problems ( refusing to stop charging interest etc ) they would let her know any advice gratefully received appreciatted thanks in advance

eyeopener2

Some creditors just refuse to play ball, they are evil bullies.

Your friend has done all she can and maybe the ombudsmen letter may change things. Stepchange do help but the onus is on you to push things along or deal with any problems.


It's just one of the pains of a DMP, some creditors are ace,some (Barclaycard) are horrible and you sort of learn to live with it.

DevCoder

The companies are under no obligation (although its considered best practise under BCOBs) to freeze interest or charges. Some creditors want their money back in what they consider a more than reasonable time period.

The company has reduced its penalty interest rate (and I assume stopped charges), thats a middle ground approach when it comes to DMP's. The FOS and the debt charities wont be able to do anymore.

Better not to rile a company you have on a DMP in my opinion as they could just withdraw from the DMP altogether and then the fees and charges will start again.

l'll don a tin hat now.

moohound

Five out of nine of my creditors continued to put interest and charges on, four were Lloyds group who put on more than the payment. And one was Halifax who put on half the payment.

Lloyds were started by Quakers who believe in social justice, but that was a long time ago now!

Barclays were fine with me, but I know they have been very difficult for some people, it all seems a bit random, but I think it depends on the % you pay. They took a reduced settlement from me and have refused it from others, it is a mystery.

After a period of time the debt might be sold to a collection agency and the interest and charges should then stop.

Some people try and save any spare cash to make full and final settlement offers to get rid of the interest charging creditors.

I sometimes wonder if it would be better if DMPs were more formal and there were rules about how much interest could be charged, say less than the payment so the debt doesn't grow. I don't know, maybe they are better as they are, for flexibility I suppose.