DMP & Mutual Support Thread - Part 10

tayajade

Startingover14 wrote: »

Thanks - it helps a lot. Trying to get myself a list of things to do in a good order so I make sure I can get my salary paid in and access to that with the priority debts like council tax. Just didn't want to fire off letters and everything start to close down before I was ready.

I have seen things about being fair to all creditors and this month have met the minimum payment for 2/3 and the 3rd is due on 18th of this month and don't know if I should leave this direct debit in place until after this payment has been taken. I will be able to do this for the month. Is this a bad idea or should I be doing the token payment thing straight away?

Hi ,

I see that you have already has some great advice. We decided to start making token payments part way through a month, we made the min payments on the debts that were due at the start of the month but those due at the end of the month got a token payment of 5 pounds. This hasn't caused us any problems, I think that treating creditors fairly comes into effect when the Dmp is up and running for example if you decided to pay an extra 50 pounds per month directly to one creditor the other creditors in your Dmp would see that as unfair. My advice would be to cancel your direct debit and send a letter to the creditor explaining that you are experiencing financial difficulties and are reviewing your situation along with a token payment and put the extra money towards your emergency fund rather than cripple yourself to pay it in full month when your going into a Dmp soon anyway. You have some time as it takes a few days for the creditor to register that the minimum payment hasn't been met, I think that we sent the letter out with token payment 3 days after the payment was due, so this should buy you some time to get your salary etc secured.
We have made 2 months of token payments while the Dmp is in set up and the creditors have been very understanding particularly MBNA, we haven't had any phone calls to chase payments at all.

Sazzie23

tayajade wrote: »

Hi ,

I see that you have already has some great advice. We decided to start making token payments part way through a month, we made the min payments on the debts that were due at the start of the month but those due at the end of the month got a token payment of 5 pounds. This hasn't caused us any problems, I think that treating creditors fairly comes into effect when the Dmp is up and running for example if you decided to pay an extra 50 pounds per month directly to one creditor the other creditors in your Dmp would see that as unfair. My advice would be to cancel your direct debit and send a letter to the creditor explaining that you are experiencing financial difficulties and are reviewing your situation along with a token payment and put the extra money towards your emergency fund rather than cripple yourself to pay it in full month when your going into a Dmp soon anyway. You have some time as it takes a few days for the creditor to register that the minimum payment hasn't been met, I think that we sent the letter out with token payment 3 days after the payment was due, so this should buy you some time to get your salary etc secured.
We have made 2 months of token payments while the Dmp is in set up and the creditors have been very understanding particularly MBNA, we haven't had any phone calls to chase payments at all.

I agree, at some point all the creditors are going to be uneven, going off part way through the month won't change anything in the long run. If you aren't going to be able to pay, fess up now, cancel DD and start getting those letters out, paying one more is just putting off the inevitable I think. I can understand why you don't want to make that big step, if you've always paid your bills, not paying is HUGE, however, you'd be surprised and it's really not the end of the world, only the world as you know it. :eek:

Oh well off to bed .....

timeforaction_2

Time_to_face_the_music wrote: »

The easy answer is yes for me but it's not for everyone. I wish I had known we could self manage at the start but when I came here, I did not even know what a DMP was!

You get much better control and can adjust/drop/stop payments to individual creditors if they won't play nicely. I also loved regaining the control, paying who I wanted/when I wanted. Plus because we had been with Stepchange (then CCCS) for a few months, going self managed immediately put us a month ahead as no-one was holding onto our payment for 25 days. I also managed to get interest stopped that Stepchange couldn't.

On the downside you do have to deal with everyone yourself and have no back up of the middleman of Stepchange etc. You need to feel confident enough to do that and to be organised with making your payments and keeping an accurate record of exactly what is going on with each creditor.

19 years is a very long time for a DMP, recent guidelines state it should not be over 10 years. Is there a reason why you are not looking at an IVA?

TTFTM x

I don't want an iva, im hoping to pay it off quicker than 19 years

timeforaction_2

Puzzcat wrote: »

May be better to get everything settled and then think self managed, get those debts going down....x

Great advice Puzz x

Startingover14

Thanks tajajade and sazzie23

That's exactly how I feel, worried to stop paying on time and paying what they ask as it scares me what they will do. But I do need to as taking control of this is far more important. I've got a follow up call with Stepchange this week to go over questions and thoughts Ive had since the call last week.

I've just started a new job and we get paid around 20th month so I think that given I need to set up a bank account first and then ask payroll to put my money in there I won't be able to start with the DMP until October as priority bills come out 1st month. August salary will go into old bank account as the new one won't be set up in time and there wouldnt be enough money in there to cover the priority bills. So will do as you suggest and write to the creditors explaining I am reviewing my situation with Stepchange and give them token payments.

Hoping its ok to keep asking questions as its good to speak to people who understand and know how it feels.

Time_to_face_the_music

Startingover14 wrote: »

Thanks tajajade and sazzie23

That's exactly how I feel, worried to stop paying on time and paying what they ask as it scares me what they will do. But I do need to as taking control of this is far more important. I've got a follow up call with Stepchange this week to go over questions and thoughts Ive had since the call last week.

I've just started a new job and we get paid around 20th month so I think that given I need to set up a bank account first and then ask payroll to put my money in there I won't be able to start with the DMP until October as priority bills come out 1st month. August salary will go into old bank account as the new one won't be set up in time and there wouldnt be enough money in there to cover the priority bills. So will do as you suggest and write to the creditors explaining I am reviewing my situation with Stepchange and give them token payments.

Hoping its ok to keep asking questions as its good to speak to people who understand and know how it feels.

If you have debt with current bank e.g. overdraft or credit card, do not write to them until you have new bank account sorted out and money safely transferred.

Ask as many questions as you need, someone here will always try and help you.

TTFTM x

tayajade

Startingover14 wrote: »

Thanks tajajade and sazzie23

That's exactly how I feel, worried to stop paying on time and paying what they ask as it scares me what they will do. But I do need to as taking control of this is far more important. I've got a follow up call with Stepchange this week to go over questions and thoughts Ive had since the call last week.

I've just started a new job and we get paid around 20th month so I think that given I need to set up a bank account first and then ask payroll to put my money in there I won't be able to start with the DMP until October as priority bills come out 1st month. August salary will go into old bank account as the new one won't be set up in time and there wouldnt be enough money in there to cover the priority bills. So will do as you suggest and write to the creditors explaining I am reviewing my situation with Stepchange and give them token payments.

Hoping its ok to keep asking questions as its good to speak to people who understand and know how it feels.

I was exactly the same as you, we never missed a payment, never thought i would and the idea of just stopping was very daunting (sometimes i still can't believe i have done it). I braced myself for phone calls and harsh letters but honestly the responses that we have had have been more along the lines of 'we are sorry to hear your struggling we will put the account on hold and await further correspondence'. You will get automated letters saying 'you haven't made your minimum payment, please contact us to make a payment' etc. but when we called we were told not to worry as they were just automated letters and that they had received the token payment which was sufficient while we were sorting things out.

This is still newish for me too but we stopped paying mid June (sending token payments to the last creditor due that month) then we sent letters and token payments to all creditors in July. We then decided to defer the start date of the DMP to september so that we could use the extra money to put in a savings account as an emergency fund, again we sent letters to all creditors with token payments for august explaining that the DMP payments would start via pay plan in september.

Maybe consider doing a couple of months token payments, you can still get everything set up with step change but ask them to put the first direct debit date to november instead. This way you will have some money to put aside (especially with christmas approaching). Most of the more experienced people on here advise 2-3 months of token payments as it also helps to encourage early defaults which will help to get your credit file clear sooner rather than later.
I promise that once you have done it you will feel total relief and wonder why you struggled on for so long!

Sazzie23

Startingover14 wrote: »

Thanks tajajade and sazzie23

That's exactly how I feel, worried to stop paying on time and paying what they ask as it scares me what they will do. But I do need to as taking control of this is far more important. I've got a follow up call with Stepchange this week to go over questions and thoughts Ive had since the call last week.

I've just started a new job and we get paid around 20th month so I think that given I need to set up a bank account first and then ask payroll to put my money in there I won't be able to start with the DMP until October as priority bills come out 1st month. August salary will go into old bank account as the new one won't be set up in time and there wouldnt be enough money in there to cover the priority bills. So will do as you suggest and write to the creditors explaining I am reviewing my situation with Stepchange and give them token payments.

Hoping its ok to keep asking questions as its good to speak to people who understand and know how it feels.

Very timely advice from TTfTm and also if you are in any danger of not paying your priority bills, get the cash out and pay those priority bills over the counter if needs be, no point making life difficult by upsetting your rent/mortgage/council tax etc.

It is hard, especially at first, but there are lots of folk here who understand, & you may not realise but lots of people read the threads wihout posting here, so you may be helping someone else by asking...so ask away.

And my question is, anyone heard from MB ?

tayajade

Hello,

I have a quick question, we have been given a freest box so we are cancelling sky to free up some money. We currently have broadband and phone with sky and have found a cheaper deal with BT which also includes £100 sainsburys voucher which would be handy for christmas gifts

I was about to order when it asked my permission for a credit check- it hadn't occurred to me that i would need to be credit checked. If i did this (have cancelled the order for now) will it look to other creditors like i am trying to obtain further credit therefore jeopardising my DMP even though I am actually just trying to save money?!

Growurown

tayajade wrote: »

Hello,

I have a quick question, we have been given a freest box so we are cancelling sky to free up some money. We currently have broadband and phone with sky and have found a cheaper deal with BT which also includes £100 sainsburys voucher which would be handy for christmas gifts

I was about to order when it asked my permission for a credit check- it hadn't occurred to me that i would need to be credit checked. If i did this (have cancelled the order for now) will it look to other creditors like i am trying to obtain further credit therefore jeopardising my DMP even though I am actually just trying to save money?!

We wanted to change provider and they turned us down on the basis of the credit check. However we were several years into our DMP and you are just starting out so hopefully you won't have a problem being accepted. It won't jeopardise your DMP. We are allowed to have things on monthly payments like broadband, insurance, mobile phones etc. Although it looks like credit it is essential stuff that creditors accept people need.