DMP & Mutual Support Thread - Part 10

Sazzie23

Acuna2013 wrote: »

Hi everyone !!
I'm new to this forum but did spend many days looking through posts for advice before I took the plunge and started my debt free journey with a DMP with Stepchange. So firstly thanks to all pf you for your knowledge and info!
I originally had £26500 of debt and started off with a £310 /month payment in July 2013. I have now upped this to £380 as i have made savings by paying off and handing back a hire purchase car and reducing my mobile phone bill. I will soon receive around £2000 in free shares that i got from work almost 3 years ago now, and I'm considering coming out of my DMP to begin repairing my credit rating. Here are my current debts:

Virgin cc(taken over by moorcroft) 5900
Natwest cc 4700
Mint cc 3800
M & S cc 2680
Argos Card 1260
Natwest O/D 1220
Aqua cc (now Lowell ) 450
1st Direct 360

My plan is to pay off the bottom 3 debts with the 2000 and go back to paying the others above the min payment, as i have calculated that I can now afford this in a few months time. The main reason for this is so i can improve my credit rating over the next 18months to 2 years so i can hopefully start looking into a mortgage. By coming out of the plan i also would have the flexibility of being able to pay extra off the remaining debts to chip away at them. My main concerns are what happens when i cancel my DMP? Can creditors add interest from the past? How quickly will my credit score improve? My plan is not due to end until august 2019 as it stands, and as my largest debt is now being run by dca (moor croft) I'm led to believe they can't add any charges on. Any thoughts or advice would be gratefully appreciated:)

Acura, great news about the £2000. My brain isn't working too well at the moment, but have you looked at the snowball calc to see tHe best way to clear it all once you've paid off the 3 you can.

I don't think creditors can reinvent interest if suspended but obviously you'd go back to interest payments, and maybe at high rates, mine had got to 29% which was one of the factors pushing me into DMP.

Your defaults will stay on file for 6 years from defaulted date, but how long the mortgage companies take heed of them will vary. I'd imagine if you clear the debts and don't increase them, they will start to matter less but you might still have trouble getting good rates, but that's only what I think, I don't know.

Sazzie23

Coinmachine wrote: »

I posted this on the charging order myth thread but also posting here as may get more replies of thats ok.

I have been on a DMP since last March, due to end in Jan 2024 on current payment rates. One of my creditors has written to me to state that they intend to issue proceedings and that if they get a court judgement they may apply for a charging order. The letter goes on to state that so long as I continue to make my reduced payment each month they do not intend to take any further recovery action.

Having read the information here, and spoken to StepChange, I understand that this is just that lender protecting their position, also as the property is in joint ownership, it would be a restriction and only on my half of the proceeds (we have no intention of moving house).

This creditor is not my main creditor, in fact there are three others I owe mor emoney to, are they likely to follow suit if they find out that this lender is taking this course of action. Would there be any worth in me writing back to the lender, asking them to reconsider thie course of action, on the grounds that I have been making payments back every month, I would hope to increase these over time if my overall financial situation improves, I owe more money to other creditors who so far have not taken this course of action, and that the property is jointly owned? Or, shoul dI save all this for when/if they take the action?

Hi Coin,

I have heard of creditors doing this but it's actually seems to be very rare when you talk to other DMPs but they can do this. I don't think other lenders will do the same unless there is a chance you are not,paying. Feel free to name and shame - someone else might have relevant knowledge of their tactics.

It sounds to me more like Puzz says, if you dont keep paying you'll go to the workhouse with no tea, have they actually defaulted you on it?

Time_to_face_the_music

idiot84 wrote: »

Hi everyone!

Just another thankyou for everyones posts! I have read the previous thread and now all of this one and i am feeling a little more confident about setting up and commencing my dmp. I have a question for any of you lovely people regarding setting up the payments to my three creditors.

I have contacted them and arranged a reduced payment for this month and via phone and drafted my letters and budget form to send to them next month explaining my financial predicament and the pro-rata offer of monthly payments; Will they just alter my monthly direct debit amount from the original (if accepted) or will i have to ask them for there details and set up a new standing order/direct debit????

Did you set up a new "safe" bank account or don't you have debt links with your existing current account?

Don't trust creditors to alter your DD. I would recommend cancelling the DDs completely and paying either by standing order or using your online banking to pay bills.

TTFTM x

Brogden

Acuna2013 wrote: »

Virgin cc(taken over by moorcroft) 5900
Natwest cc 4700
Mint cc 3800
M & S cc 2680
Argos Card 1260
Natwest O/D 1220
Aqua cc (now Lowell ) 450
1st Direct 360

My plan is to pay off the bottom 3 debts with the 2000 and go back to paying the others above the min payment

Just a thought Acuna.......that Aqua cc is with Lowell so presumably previously defaulted and no interest being charged. Don't just pay it in full.....make an offer! Also bear in mind that it may be more cost-effective to hit the debts where interest is being paid first - whether that's a good idea or not depends on how good a discount you can get from Lowell - don't offer too much to them although they're bound to try to get you to increase any offer you make !!

Good luck!!

Brogden

Coinmachine

thanks, and to Sazzie as well. It is Nationwide who have been quite reasonable up to now. I dont think it is one of those type of letters though, yes they have defaulted me. I am going to try and write a nice letter back asking them to reconsider beacseu of the amount i have paid back already and that i hope to increase this over time, other lenderd havent taken this action, and the property is not solely owned - will let you know how I get on.

Puzzcat wrote: »

Hi coinmachine, sorry I don't have an answer but are you sure it's not just the usual kidnap your cat's/squeeze lemon in your eyes type threat?
If your really worried I'm sure SC will have an answer...
Puzz.x

moneyworrier89

Hello all,
Just a quick message to let you know my DMP has now started.
My first payment is due to come out on the 10/02/2014 which is 5 days before payday so not ideal but I will just keep the money aside until a couple of days before.
Stepchange have advised they've let all my creditors know so can anyone please advise what to expect from here?
I thought I'd feel some sort of relief but just feel anxious and worried.
Thankyou x x x

joee

Hello money worrier89,


I am really glad to hear that your DMP is all set up, I am not very confident answering questions. I know that each creditor works differently but it is important to remember that you cannot pay anymore than what already are and you are taking the first steps towards debt freedom and that you are trying your best.


I thought that you might be interested in this link on the Stepchange site about what happens during the first year of a DMP - http://www.stepchange.org/Existingclients/DMPclients.aspx


Please stick around and post in this thread when you are able to, although I don't post much there are some beautifully supportive people here.


Take gentle care
Lucy xx

idiot84

Time_to_face_the_music wrote: »

Did you set up a new "safe" bank account or don't you have debt links with your existing current account?

Don't trust creditors to alter your DD. I would recommend cancelling the DDs completely and paying either by standing order or using your online banking to pay bills.

TTFTM x

Hi thanks for the reply.

No i dont have any debts with my current account bank (RBS). I think they were part shareholders to Tesco a few years ago but i dont think they are now.

I will cancel my DD's then just to be on the safe side. Should i just phone them and ask for the standing order details? I dont want to leave to paying manually as i would hate to miss a payment once settled i to my DMP.

System

Well we seem to be having a nightmare setting up a new joint bank account.....Nationwide have said we are accepted but it could take 5-7 days for use to receive the paperwork to sign and then another 10 days for account to be set up. Natwest have said they will let us know if we have been accepted, but they have accepted me for an account of my own, but that is no good for our joint bills.
It just all seems to be taking so long and I have the SC pack here but cant send it back yet without the new bank details....am I just being too anxious about it all?

SquirrelNuts

moneyworrier89 wrote: »

Hello all,
Just a quick message to let you know my DMP has now started.
My first payment is due to come out on the 10/02/2014 which is 5 days before payday so not ideal but I will just keep the money aside until a couple of days before.
Stepchange have advised they've let all my creditors know so can anyone please advise what to expect from here?
I thought I'd feel some sort of relief but just feel anxious and worried.
Thankyou x x x

Hi MW89

Stepchange can also take out DD's on the 1st of the month if you ask them which might be better timing for you.

Of course that would mean first DD on 1st March (assuming you don't have funds for 1st Feb) so first payments to creditors would be on 25th March. You could always do £1 token payments for Feb in the meantime.

Up to you of course, but another option to think about...

Squiz