Selling House....On DMP...Do I have to declare equity

OhNoNotAgain

Hello - I wonder if anyone has any experience with this,
I have been on a DMP for about 6 years. When I entered onto the plan I was a single girl living in a one bedroom flat (very small)
Over the years I have met a partner and had 2 children.

Long story short - we are all 4 still in the one bedroom flat. Unfortunately my partners credit history is no better than mine.

We can get no credit. We cannot re-mortgage even though we have had 6 years of faultless payments. In fact until recently we thought that we we were even unable to sell as we did not have the money for legal fees and a deposit for a new place. If my parents had not stepped up and lent us what was required in order to sell the property and move into a new place I don't know what we would have done as no one would help us as my partner earns 35K a year and until maternity 2nd time round so did I. Authorities seems to think that we are not eligible for help and that we are somehow OK - despite the fact that every spare penny was going on the plan - I digress.

Ultimately - thanks to my M&D the flat sale is now going through and we are lucky enough to have equity which we can pay off the debts with, The thing is I want to make my creditors an offer - I don't want to pay all my equity to the debts after all the many many years of interest I have paid them 10 x's over already.

So my question is am I legally obliged to declare exactly how much money we have once the sale goes through or can I just ring them and say I have X amount to pay you back and no more......

Sorry for waffling, any advice appreciated. x

Meatloaf1981

No you absolutely do not have to declare your equity to your creditors. If you were minded to make them offers to settle your debts and you wanted to use the equity for that, that would be entirely up to you to do so or not. You would then need to work out a pro rata offer to your creditors that seems fair to you (I think people normally offer 20 - 40%) and make it clear to them that you only have finite funds. You don't have to declare where those funds came from.

Sazzie23

Agree with meatloaf and heard of some very good deals at 25% being made on F&f payments, however probably best to have whatever explanation you feel you want to give them ready in case they ask.

Nothing worse than getting flustered with a question you were hoping they weren't going to ask.

OhNoNotAgain

That's amazing - Thank you. I am a bit of an honest Jo and would have probably - reluctantly, given it all away but honestly it is none of their business is it. Thank you for your reply

Meatloaf1981

Also, it is worth mentioning that if you do make some full & final's, make sure you get them in writing. It might be best to pen a letter to them if there is no urgency, rather than risk being asked difficult questions you might feel obliged to answer on the phone, even if legally you don't have to!

OhNoNotAgain

That is good advice Meatloaf, That is what I am going to do. Part of the DMP annual assessment is to confirm how much your house is worth - so they also know how much I originally bought it for, I will squirm if they ask questions. We are not going to be able to buy again for a while and will be renting. We have paid enough penalties for a few years of stupidity. Thanks again x

National_Debtline

Hello there,

As the others have said, there is no obligation to let them no, they wouldn't have any right to the money. In addition, also like the others have mentioned - you could consider offering your creditors Full & Final settlments. They can be very effective.

More info on those here:
https://www.nationaldebtline.org/EW/factsheets/Pages/24%20EW%20Full%20and%20final%20settlement%20offers/Default.aspx

Very best wishes,

David @ National Debtline.

OhNoNotAgain

Thanks David - I did not know how to work out the pro-rata settlement offer - very useful link, I have book marked until I am ready.