Help - Self Managed DMP

City1

Hi I was wondering of peoples thoughts on this?
We are looking to do a DMP initially with SC, however after a lot of thought we have decided to go it alone, for a number of reasons.
Anyway today we were talking to a friend who is in a similar situation to us, he said that we shouldn't pay anything to the Cc's then wait for the debts to get bought by the debt collection companies, then make them an offer of how much we can afford to pay - that way are interest is frozen, we have 'defaulted' and then we can get ourselves sorted.
I have been making token payments of £1.00, and have been getting letters saying the obvious. His argument is that you can't meet the minimum payments so you are breaking there terms anyway. So will still get charges and interest.
We initially thought about sending letter to banks telling them of our situation with a plan for repayment, he seems to think that this would be pointless as they would probably not play ball in freezing interest.
Would appreciate anybody's views on what would be the best course of action, either way we will have a shot credit rating for a while anyway.


Regards

meredith132

I would be interested in answers for this. It seems like a Pandoras box when you start getting into all this! xx:eek:

savingmummy

How much do you owe and who too?
You say your paying £1 token payments id this because you have no income?

City1

We owe a lot in excess of £60000, to 16 cards. We were paying £1.00 not because of income but through advice whilst we were considering a DMP. We have been advised an iva, but this of no interest.

dancingfairy

It's an approach obviously. If the payments are small and the companies don't think they'll get the money from you then yes I think they'll be more likely to sell the debt on at which point you'll be in a good position to settle.
However 1) it seems morally dubious. I do believe people should make every effort to pay their debt back even if it takes a while (having said that companies should give more help to those that are struggling and should accept payment plans).
2) most companies do stop interest and charges after a while but it can vary between creditors.
3) I think the biggest risk(s) are that the creditors think you are untrustworthy and unlikely to stick to any agreement but mainly that they are perhaps more likely to go to court if they feel you are deliberately not paying them what you can afford. I doubt a judge would be too impressed either by you only paying token payments when you could afford more. Having said that I don't know how much impact that would have on what a judge would order you to repay as they are obviously bound by guidelines.
I think at the end of the day it's up to you which approach you take.
df

dancingfairy

Do you own your own house? Do you have much/any equity? Your biggest problem is going to be that the creditors may try and make you bankrupt. I don't know how making very small payments would be viewed by them or whether it would be more likely to make them consider bankruptcy?

df

GettingOrganised

I started on on my own about a year ago. I sent the letter to creditors template on the national debt line website along with my income/expenditure. All creditors agreed to freeze interest and charges. Personally, I would prefer to try this first. I think they could still choose to pass onto a debt collection agency, but I haven't got any experience of this to offer advice on.

City1

Thanks for this, we are merely looking at ideas. Not that we were trying to be morally dubious. The token payments were made as a result of these forums. We were looking at paying between £25 - £50 per month to each card, this what we can afford to pay without any detriment to our children.
I think what we will do is send letters to banks offering these amounts, detailing our present income, then if they don't like at least we will have tried...

City1

Thanks "getting organised", that was the kind of answer I was hoping for.

savingmummy

Good luck!
Let us know how you get on.

Time_to_face_the_music

City1 wrote: »

Hi I was wondering of peoples thoughts on this?
We are looking to do a DMP initially with SC, however after a lot of thought we have decided to go it alone, for a number of reasons.
Anyway today we were talking to a friend who is in a similar situation to us, he said that we shouldn't pay anything to the Cc's then wait for the debts to get bought by the debt collection companies, then make them an offer of how much we can afford to pay - that way are interest is frozen, we have 'defaulted' and then we can get ourselves sorted.
I have been making token payments of £1.00, and have been getting letters saying the obvious. His argument is that you can't meet the minimum payments so you are breaking there terms anyway. So will still get charges and interest.
We initially thought about sending letter to banks telling them of our situation with a plan for repayment, he seems to think that this would be pointless as they would probably not play ball in freezing interest.
Would appreciate anybody's views on what would be the best course of action, either way we will have a shot credit rating for a while anyway.


Regards

Your posts are a little inconsistent, in some you say you are £60K in debt, in others you state £78K. Can you please clarify which is correct?

Also you say you had none/very little debt 10 months ago, so what did you spend the money on? And can you sell any of it?

Do you have a specific reason why you don't want a managed DMP and why you are so resistant to the recommended IVA?

I self manage our DMP, having started off with Stepchange then moved to self managed after 9 months or so. Given my time over again, I would have made token payments for the first few months to encourage defaults. Instead I paid a large amount from the start and with the help of the DMP & Mutual Support Thread, I learned how to fight the interest and get it stopped myself. From a starting debt of £82,344, 28 months on, we have paid off over £59,400 and hope to be debt free in a year or so.

if you want help in how to do this, I will be more than willing to assist but it's not easy, you need to be prepared to fight and you obviously have to make some sacrifices.

Get your facts, figures and story straight, get a break down of your I&E on here and I will help but the sooner you get this started the better. Dawdle and you will be getting interest and charges left right and centre plus with the amount of debt you have, you are risking CCJs and charging orders on your property.

TTFTM x