Debt Debt Debt

Gerry11

Hi,

I have recently fessed up to my better half about my debt problem, painful to say the least. The problem totals about £25k on 3 different credit cards, a loan and a £3k overdraft.
I got there by living beyond my means, like most people in this position I suppose.
The problem has been that my stress levels have been enormous and behaviour like trying to get to the mail before my partner so that then extent of the debt can be hidden, hiding the truth. I'm not a liar by nature but I found myself becomming one.
So self hate still there to some extent now the truth is known, I have approached stepchage who are going to set up a DMP.
I am worried about the potential damage to my credit score and in turn that of my family, my debt problem has now damaged mine and my partner's ability to get credit, so no new car for my partner etc.
Has anyone else had similar experience and how badly can a 7 year DMP damage your credit score, if you pay the amount off faster than 7 years how long before you can return to being regarded by financial institutions as credit worthy.

savingmummy

Hello welcome and well done for posting!


I wouldn't worry about your credit score right now, you know it will be effected BUT your on the right track now with the dmp and your aim is to get debtfree.
THEN you can start rebuilding your credit score, and remain debtfree from now on.


Its a BIG step confessing to your debts, you`ve done a good thing telling your partner. You can now get support and work together.


Do you and you partner have joint accounts?
Reason I ask if my husband has debt and a poor credit history which his had for 8yrs, and its not effected me at all.
Our finances are kept separate though.

dancingfairy

To be honest a temporarily damaged credit rating is probably inevitable.
What use is a decent credit rating anyway? You probably couldn't have got more credit due to the large (well probably large) debt in relation to your salary.
Also when debt gets out of control it can lead to missed payments/robbing peter to pay paul, late charges, and interest etc, all of which would take their toll on your credit score anyway.
It's best to get it over and done with. If you have a problem, the sooner you accept it and get help the better (which you have done).
Your defaults will stay on your file for 6 years I believe but obviously a recent default is going to look a lot worse than one several years ago. My point is that it will naturally improve over time. In 6 years time yes you will have the defaults but hopefully you will be back on the straight and narrow again and can build up a good, regular repayment history going forward. I don't know exactly how they view regular payments as part of a dmp but I would hope that a regular payment to it would count for something (and it's paying the debt off).
df

Firewalker

You know, this credit score thing is very peculiar. When we first realised how much debt we were in my default position was to worry about my credit score - this is the message we get; how important this is. Things started looking up when I changed my focus: my problem was not my credit score but my debt. I didn't need (and learned not to want) more credit; I needed to pay the debt off.

We paid off all our debt in three years; my credit score is perfect and we are bombarded by 0% offers. I still don't want credit; I've started building wealth.

Just a thought!

longtermplanner

There are no solutions to major debt problems that don't damage your credit rating.

Your partners will only be damaged if you have joint accounts, loans etc. If the only thing linking you is a joint current account, then switiching to separate accounts would be a good idea.

sourcrates

As others have said, your credit score is meaningless in reality, you have a large amount of debt which you need to shift, and that should be your priority, you are in this mess, and now you need to focus on getting out of it.
Your credit file will show these defaults for 6 years, no escaping that fact, yes the quicker its paid, the quicker you can return to normality, but if normality is been in debt, then you may want to have a re-think !!!!

Historybuff

Good for you, Gerry, for coming clean and doing something about the debt. The others are right...forget the credit score and concentrate on eliminating the debt as soon as possible. I want to do like fire walker...build wealth! I'm working on it...It may take a while!

Thrugelmir

Gerry11 wrote: »

Has anyone else had similar experience and how badly can a 7 year DMP damage your credit score, if you pay the amount off faster than 7 years how long before you can return to being regarded by financial institutions as credit worthy.

You are going to spend 7 years repaying £25k of debt. Like an alcoholic attending AA, the last thing you'll need is credit. Learn from the experience. Become a saver before a spender.