Friends DMP in Scotland, does this sound right?

19lottie82

One of my friends has apx 14k of credit card debt and have informed me that he has applied for a DMP.

He says it's through a charity and there is no charge (Stepchange, I'm guessing, but he hasn't confirmed?). But he sais that h can pay £100 a month and it will be paid off in 10 years but they have advised (based on his incomings / outgoings) that he pays £20 a month but it will take 53 years to complete!!!!

I thought that you just paid what you could afford for 3 (?) years then that was it done with?

Sorry if the details are vague, all I got from him was info from him via a few texts.

Just wanting to make sure he's not being ripped off!

sourcrates

Hi,
There is no fixed term for a DMP, it depends how much debt you have as well as various other factors.

Everyone will be different, as you pay until your debt is gone, it's not like a regulated IVA agreement where after a certain period your debts are written off.

Your friend may be better off with a more formal arrangement to clear his debts quicker.

19lottie82

Thanks SC. Can I ask what you mean by a more formal agreement?

sourcrates

19lottie82 wrote: »

Thanks SC. Can I ask what you mean by a more formal agreement?

There are government statute options for dealing with debt.

May be under a different name in Scotland, but in England, there's an IVA (individual voluntery arrangement), DRO (debt relief order) or Bankrupcy to deal with your debt.

Lots of advice and options to repay debt on here :

https://www.nationaldebtline.org

Your friend may find a DRO or Scottish equivalent, to be a better option.

National_Debtline

19lottie82 wrote: »

One of my friends has apx 14k of credit card debt and have informed me that he has applied for a DMP.

He says it's through a charity and there is no charge (Stepchange, I'm guessing, but he hasn't confirmed?). But he sais that h can pay £100 a month and it will be paid off in 10 years but they have advised (based on his incomings / outgoings) that he pays £20 a month but it will take 53 years to complete!!!!

I thought that you just paid what you could afford for 3 (?) years then that was it done with?

Sorry if the details are vague, all I got from him was info from him via a few texts.

Just wanting to make sure he's not being ripped off!

Hi lottie


I'm having to make an educated guess from the snippets your friend has given you, but I suspect that he may actually be talking about a debt repayment programme under the Debt Arrangement Scheme (or DAS for short). This would give him protection from further interest, charges and action by his creditors. It could also allow him to get some of his debt written off if he can stick to the agreed payments for long enough. Stepchange do help to set these programmes up for people who are eligible.


More information can be found at:


https://www.nationaldebtline.org/S/factsheets/Pages/22%20SCOT%20Debt%20Arrangement%20Scheme%20%28DAS%29/Default.aspx#


The options for dealing with debts in Scotland differ from those in the rest of the UK, although there are rough equivalents. If you're not 100% sure whether he has taken advice from a free service, why not point him towards our Scottish website for the facts:


https://www.nationaldebtline.org/S


Dennis
@natdebtline