DMP & Mutual Support Thread - Part 10

Monkeyballs

moneypit2014 wrote: »

Even if Step change themselves are telling you to do just that?

Hi MP,

Have you spoken to someone at SC who has suggested favouring one creditor over another? If you have then you might want to run it past them again...

In the past I have spoken to them and they have categorically told me to not favour one over another due to the risk. That said, I wasn't expecting them to say anything else as they need to maintain relationships on our behalf so they have to be impartial.

What they tend to say is that a friend or relative can give you funds to make F&F's, obviously if it's just enough to pay one creditor off then so be it but it needs to be made clear that it is not your money... Obviously if you get a lump sum from a PPI claim or similar which will allow you to make F&F's to all then that's a different story...

The reason I mention is because of recent discussion on the thread about regarding F&F's and scraping cash together as you go along and wiping the debts out one by one. If it's an odd one here and there over the course of the year then it likely won't be suspicious but everytime a debt is removed and your DMP updated, SC need to update the rest of your creditors with a list of outstanding debts and offers of payment...

Basically, you need to be a bit tactful and/or perhaps save a fund to make F&F's on all your debts at the same time

MB of G x

Sazzie23

Monkeyballs wrote: »

Hi MP,

Have you spoken to someone at SC who has suggested favouring one creditor over another? If you have then you might want to run it past them again...

In the past I have spoken to them and they have categorically told me to not favour one over another due to the risk. That said, I wasn't expecting them to say anything else as they need to maintain relationships on our behalf so they have to be impartial.

What they tend to say is that a friend or relative can give you funds to make F&F's, obviously if it's just enough to pay one creditor off then so be it but it needs to be made clear that it is not your money... Obviously if you get a lump sum from a PPI claim or similar which will allow you to make F&F's to all then that's a different story...

The reason I mention is because of recent discussion on the thread about regarding F&F's and scraping cash together as you go along and wiping the debts out one by one. If it's an odd one here and there over the course of the year then it likely won't be suspicious but everytime a debt is removed and your DMP updated, SC need to update the rest of your creditors with a list of outstanding debts and offers of payment...

Basically, you need to be a bit tactful and/or perhaps save a fund to make F&F's on all your debts at the same time

MB of G x

Hi MB

Sounds like good advice to me.
Early on in my DMP I paid off our overdraft creditor, this actually happened accidentally as our Ppi refund was repaid into the wrong account, which was closed so I couldn't get it back. Whilst it was a disaster at the time, in the end it did me a favour as it was the only joint debt on the DMP. SC did enquire how we managed to pay off this debt and when I explained they didn't think it was a problem.

The remaining payments were then split between the other creditors, shortly after that I had to reduce payments which took the individual payments back to about what they were originally so I don't think the creditors really noticed especially.

Have a good day everyone

Kate_fixing_it

As MB has mentioned PPI I'll chime in. The PPI redress I have is equal to around 30% of my debt. All my creditors will be made the same offer. Therefore, in my case I am treating them fairly as they're all getting the same offer. Where negotiations go from there is anyone's guess. Ideally I'd like to be rid of the one creditor that is still charging interest and the dreaded HSBC but we'll have to wait and see. I may get one acceptance at 30% and be able to negotiate another to 50%. I may get one that will settle for 70% and all others laughing in my face but the main point is that I will have treated my creditors fairly because they all got the same initial offer. If nobody is willing to negotiate then it'll go into a savings account and we wait 6 months. I'm not really expecting anyone to accept 30,it's a starting point, some will accept no less than full payment but I'm making a fair offer to all based on cash available.

At the start of my DMP I was very gung-ho about getting rid of it all ASAP. I can honestly tell you I could have written the above posts myself but my attitude has changed now I'm into the plan. I still have one eye on the grand prize of debt freedom but it's a "back of the mind" thing. It's more important to me to live and learn in the present. All my problems won't be solved by being debt free tomorrow - it won't increase my daughter's chance of a uni place, the car will still break down at some point and the Ebola epidemic won't go away. What I'm saying is my life is no longer ruled by my debt. It is a part of me now (it's tattooed on my brain!) but there's more to me than debt.

to be very blunt none of us know what will happen tomorrow (which is why people urge anyone in debt to have an emergency fund) any one of us could be hit by a bus tomorrow and be unable to work again and whilst I advocate throwing every spare penny at debt I don't believe that it should be at the expense of giving up a safety net.

Kate x

GibbsRule_No3

When I received a PPI refund. I offered F+F pro rata to all, Barclaycard refused anything M+S said they would accept a higher offer, so I gave them the Barclaycard amount. I then point blank refused to pay Barclaycard the full amount monthly that I had been paying the ones that did accept, especially as they were the only ones adding to my debt. Payplan accepted less per month when I rejigged the amounts. Now debt free, DMP best move for me as my lump sum and pension is now all mine, still putting the DMP money away every month and living on the extra I did not pay Barclay card, around £160 for the past 18 months. Savings growing nicely.

Kate_fixing_it

moneypit2014 wrote: »

Even if Step change themselves are telling you to do just that?

I think this was probably said as part of a longer thread of conversation. I very much doubt these were "instructions". SC see hundreds of different situations every day, I think the advisor was probably trying to give you a bit of hope that your DMP was very likely to decrease as the plan goes on.

For example, I feel I need a £500 emergency fund. If I put £50 a month into it after 10 months I have my buffer. But the DMP runs under the assumption that I'm putting that £50 away for the entire 6 years. After 20 months I would have £1,000 in my buffer so if I'm still comfortable with the £500 buffer I could use the additional £500 on F&Fs. 10 months later (still less than half way through the DMP) I could do the same again and I've potentially got rid of some creditors and reduced my DFD. Of course I would give all creditors the opportunity to accept a reduced settlement - not just pick one off.

Creditors are funny creatures, no two are the same and as you may have seen on this thread alone they may treat different accounts within the same company differently. There are no hard and fast rules for them - of course there are guidelines they must adhere to but there's a lot of room for interpretation and negotiation within that.

Of course this assumes that I have budgeted for all my needs and had no emergencies.

Kate x

Brogden

Kate_fixing_it wrote: »

I think this was probably said as part of a longer thread of conversation. I very much doubt these were "instructions". SC see hundreds of different situations every day, I think the advisor was probably trying to give you a bit of hope that your DMP was very likely to decrease as the plan goes on.

For example, I feel I need a £500 emergency fund. If I put £50 a month into it after 10 months I have my buffer. But the DMP runs under the assumption that I'm putting that £50 away for the entire 6 years. After 20 months I would have £1,000 in my buffer so if I'm still comfortable with the £500 buffer I could use the additional £500 on F&Fs. 10 months later (still less than half way through the DMP) I could do the same again and I've potentially got rid of some creditors and reduced my DFD. Of course I would give all creditors the opportunity to accept a reduced settlement - not just pick one off.

Creditors are funny creatures, no two are the same and as you may have seen on this thread alone they may treat different accounts within the same company differently. There are no hard and fast rules for them - of course there are guidelines they must adhere to but there's a lot of room for interpretation and negotiation within that.

Of course this assumes that I have budgeted for all my needs and had no emergencies.

Kate x

I think everything you are saying Kate is very wise indeed

I couldn't start with Step Change (then CCCS) a couple of years ago for three main reasons (arears in utility bills being the biggest reason.) I fell into self-management by default but found that I had an almost infinite ability to do things the way that would suit me and bring about a better and calmer family life (not perfect though !!) Step Change is a fantastic organisation but I think that some of us sometimes get a little too carried away on the 'treating all creditors the same' thing. Just my opinion.

I suppose you could say that what I have is not a DMP at all, just a guy struggling with his debts but to me it is a DMP as I am going through a process to reach a result. Its just a very flexible DMP that takes a walk on the 'wild side' now and then !!!!!

Have a great day,

Brogden.

ailz95

Just don't make my mistake and allow your DMP company to sort out your f & fs, I was with Payplan and they just paid everything that was owed - I hadn't realised that I could have negotiated with them :eek:. 60 years old and still financially naive - just shows that I should have come on here first.:money:

By the way Monkeyballs, the MB I can account for but the 'of G'?:p

Have a good one everyone

Ailz

Puzzcat

Morning..


Lots of f & f chat on here over the last 24 hours.. Personally for me my dmp is about getting my debts paid off with the least amount of interest and in the quickest time that I can manage. For me nearly a year in, the emergency fund has been battered by vet bills, broken washing machine, broken freezer and car problems..


I agree with MB that SC and probably PP want us to treat creditors all the same, although I have to say they don't treat us all the same so not sure that's completely fair..!!


Maybe if f & f's are the way you want to go from the start of your plan then you should just be self managed like Brogden who is captain of his own ship. For the rest of us motley crew who are lucky if we get to touch the oars, I for one will keep my life jacket on, keep building that emergency fund and try to stop my pets, car and white goods from making me spend it.. If I do at some point have enough money to be in the position to start doing f & f's then if i'm not happy about how SC deal with them I will jump ship and sail alone...


After the best part of 30 year in debt, this time on my dmp is retraining my 'money' brain, teaching me the art of budgeting and really making me concentrate on where I want any spare money I have to go. For me, the dmp is all about living again not just surviving, so if it takes 8 year so what.. I love my dmp...


Its all individual choice, just make the right one for you.
Puzz. x

Brogden

ailz95 wrote: »

Just don't make my mistake and allow your DMP company to sort out your f & fs, I was with Payplan and they just paid everything that was owed - I hadn't realised that I could have negotiated with them :eek:. 60 years old and still financially naive - just shows that I should have come on here first.:money:

By the way Monkeyballs, the MB I can account for but the 'of G'?:p

Have a good one everyone

Ailz

You got there Ailz95 though didn't you? Absolutely years ago I had a credit card default that was quickly sold on to a collector whose offices are a few miles from my house. Every month I called in and paid a cheque over the counter until every penny was paid about eighteen months later. It never occurred to me to negotiate either. I was so naive and conscientious in those days and worried about the debt every day. Look at me now......does age make us any better? Haha

I don't have a debt company or charity by the way - self managed and I can be as wayward as I require

Brogden.

Monkeyballs

We are a wise lot on this thread... I hope you newbies are taking note nobody on here will give you duff advice or allow you to fail!

I'd also like to add that when it comes to offering F&F's, personally I intend go through my creditors myself as I can make lower offers and barter whereas (I think) SC and other providers will want to make higher offers. Again, I'd expect this as I guess they don't want to spend time negotiating (it's not their job to do that) and just secure a settlement even if the lowest is 75% +

Sir MB of G(rayskull) x