Debt management plan help!?

Niklaxxx

I am going to explain in the most simple way that I can and hopefully somebody has some advice :-)
I went onto a debt management plan about 6 months ago after catalogue and payday loan interest charges spiralled out of control due to me making payments late :-/ I went with a company who charge a fee of £35 per month and I pay a total of £145. I recently contacted a debt management charity to see if they could help me because I wasn't happy paying £35 to the company when that £35 per month could be going to one of my creditors, the charity told me that I should never have been accepted onto the debt management plan in the first place because my overall debt was too low and could have been managed by myself. They have advised that I should take over my debt payments again by myself as it would only take 1 year and 7 months to pay off my debts( my debt managment company told me 5 and a half years) by sharing the £145 between all of my creditors and then paying a little bit extra whenever I could. Has anybody else ever been in this situation and would it be wise of me to take my debts back on myself? Also I need to add that none of my creditors have frozen any interest on my debt.

chelle1981

Firstly how much is your debt in total? I would say that in many cases it is sometimes easier to go it alone- write to your creditors explain the situation and work out what you can afford to pay them each month- do a statement of affairs SAO so you can see exactly what spare money you have- look at where you can cut costs- often food and things the mobiles, going out expenses, sky packages etc are good places to look for savings

Post your statement of affairs and then we can take it from there

Tixy

Hi and welcome

I would definitely ditch the fee charging provider.

At a guess the charity are assuming all creditors will freeze interest straight away for their calculations.
And the commercial DMP company are probably assuming none will and obviously are charging you significant fees which will extend the time it will take by a large chunk.

The reality may well be somewhere between the 2.

How much are your debts currently?

I would definitely look at a self-managed DMP, there are places that can help you with this so you wouldn't be totally on your own (CAB / national debtline / the forum users on here ).

sickasachip13

Hi,

Well done for seeing the light....Get rid of the fee-charging company!! (It would appear that you've had no real benefit from their services anyway). As the others have said - what is your total debt? And is there anything that worries you about taking the debt back under your control?

SAAC

Niklaxxx

My debt at the minute add up to about £3500. I went onto the DMP because of all of my creditors ringing and writing to me all of the time threatening me with bailiffs but when iv spoken to the advisor from the charity she says that this is just bullying tactics to get more money out of me. I was thinking of keeping the payments that I make to my creditors the same amount as what the DM company are paying and then concentrating on one creditor at a time, maybe paying an £100 per month to get each one payed off at a time. Would the creditors be willing to accept the same minimum payment that they are recieving at the minute?

sickasachip13

I don't see why they wouldn't - but you would need to set out a good rationale (and maybe a budget sheet from them) and communicate with them. Ultimately they want their money back and if you set it out that this is the way they will get their money, whereas if they stick to the original payments you won't be able to pay anyone, then they'll probably go for it.

National Debtline website have lots of template letters to help with all sorts of situation like this, so you might find them helpful.

SAAC

longtermplanner

Apart from National Debtline, there is a new CAB "DIY online" facility here https://nedcab.cabmoney.org.uk/dmp.asp which now can generate letters to your creditors if you are switching from a commercial DMP plan.

Niklaxxx

Awww brilliant. I'm gunna get this ball rolling on Monday morning! Thanks very much for all of ur advice and information it's greatly appreciated

sexyshark

if you feel a dmp is right for you speak to stepchange as i have just started a dmp with them and my debt is £2700 and they accepted me.