DMP & Mutual Support Thread - Part 11

System

Grant1wish -that's amazing, and like you say, nice to know that the rest of the money will go to your other creditors.

cmcavon

I really want to start paying extra off our DMP. Our debt-free date is making me miserable.

We have a DMP with SC and I know they don't recommend making extra payments. Thing is, I manage to make a fair bit of extra income on a regular basis which isn't included in our budget. It's not guaranteed income so I don't want to include it and overstretch us.

Do people make extra payments? If so how do I go about it? I was looking at the breakdown of our debts and the smallest debt is £220. I could clear that which would feel like a bit of a milestone reached. I don't think sc would like me doing that though as it's not fairly distributed between the debts.

Feel a bit stuck at the min, desperately want to overpay but not sure how to go about it or whether it's even a good idea!

January2015

cmcavon wrote: »

I really want to start paying extra off our DMP. Our debt-free date is making me miserable.

We have a DMP with SC and I know they don't recommend making extra payments. Thing is, I manage to make a fair bit of extra income on a regular basis which isn't included in our budget. It's not guaranteed income so I don't want to include it and overstretch us.

Do people make extra payments? If so how do I go about it? I was looking at the breakdown of our debts and the smallest debt is £220. I could clear that which would feel like a bit of a milestone reached. I don't think sc would like me doing that though as it's not fairly distributed between the debts.

Feel a bit stuck at the min, desperately want to overpay but not sure how to go about it or whether it's even a good idea!

Stash the extra money away for an emergency fund and/or to make settlement offers on one or more of your debts.

If your debts are interest free now anyway you are not doing anything more by paying more now - other than slightly bringing your debt free date forward.

If you save any extra money, when you have enough you could make a full and final offer to one or more creditors and start negotiating as low as 25% - likely to have to negotiate up from that percentage, but some people have had success as low as that.

So if you just pay extra now to debts you will still be paying whole total off - still slow progress. Stash the extra cash and you may be able to cut some of the debt balance off without ever paying it (reduced settlement figures). Debt will clear so much faster that way.

We are hoping to clear our debts in the next 2 to 3 years in this way rather than the 8 years left on our DMP

Spoonhead88

Hey guy, I'm in my sixth month of my DMP and i can report the following:

I've gone from SC to self-managed.
I've Paid off a total of £1,676.09 which means I've paid off a third of my total debt.
I should be debt free by April 17.

zenshi

What a palava! But finally got my mortgage swapped over. There wasn't an issue over me getting the new rate but oh the hoops I had to jump through!!! At last though, the new lower payment will start with July payment

cmcavon

Thank you January

So if I wanted to make an offer for the lowest debt which is only £220, I'd approach the creditor directly? It's HSBC, well the debt collection agency now actually, we also have three other debts with them for bigger amounts.

I like the way you've spelled it all out for me thanks. Stashing away and offering full and final seems a much better idea.

Suseka97

... it's been a while, so much so I lost my original login details! Anyways, there may be some who remember me simply as Suseka (back in the day). Have been AWOL simply because I got to a point where I almost felt the DMP was taking over my life, had a set back (healthwise) and just decided to drop off the radar. I'm much better now and back only to help others, if I can -if any of my experiences might be of help.

I started my DMP journey back in June 2013, with 14 creditors and £83k worth of debt. I'm now a good way in with 5 creditors paid in full and £33k/20 months left in the DMP (assuming everything stays on track).

The last 3 years haven't been easy, but I didn't expect they would be -but I have learned a lot about budgeting and I'm meticulous when it comes to watching my bank account. Most of our creditors played ball with dropping interest charges -but Barclaycard have held out and keep adjusting our minimum payment to match whatever SC are sending them - sneaky eh! We've been down the financial ombudsman route with them, but with no joy - sigh.

I have considered, on more than one occasion, whether to go self-managed and drop BC down to token payments to force the issue, but it's working fine with the remaining creditors so I'm putting up with BC's shenanigans.

All said and done I'm settled with how things are working out and glad I took the plunge to contact StepChange. In hindsight I should have done so sooner -so if I could impart one little gem of advice to anyone still on the fence about whether to do this, I say "Go For It'.

Am going to spend some time catching up with folks on here, if I can track any of the 'oldies' down , expecting (hoping) to see their names on the Debt Free Roll of Honour thread. And looking forward to meeting some of the forums newer members.

cmcavon

Wow Suseka you've done really well tackling all that debt in 3 years, hats off to you!

After posting earlier I decided to pay the smallest debt off in full. Probably the wrong thing to do all round but it's my debt and it needs paying I guess. I'm so depressed by the fact that at the moment we've still got 17 years left to go

So that's one debt gone, six more to go! Next smallest debt is £1,230 so I'm going to go down the route of stashing away as much as I can with a view to making an offer against that one.

I'm feeling very determined to get the balances down and the end date closer.

Sazzie23

cmcavon wrote: »

Wow Suseka you've done really well tackling all that debt in 3 years, hats off to you!

After posting earlier I decided to pay the smallest debt off in full. Probably the wrong thing to do all round but it's my debt and it needs paying I guess. I'm so depressed by the fact that at the moment we've still got 17 years left to go

So that's one debt gone, six more to go! Next smallest debt is £1,230 so I'm going to go down the route of stashing away as much as I can with a view to making an offer against that one.

I'm feeling very determined to get the balances down and the end date closer.

Hi CMC

I think thats a great compromise, and unless the debt had gone to DCA its unlikely you'd have got much off it, and in the end, if it gives you a bit of vavavroom to get going again, its a good investment:T

Suzeka - good to see you back round these parts, and well done for your excellent progress. those 20 months will whizz by.

Saz

p.s. (BC - booooo)

pps they say your f&f should start at 25% offering !!!!

System

Hi everyone.
A question from me, prompted by the last few posts....

It's about your credit rating / file - so i get that once you get a default it will hang around for 6 years. If you offer and they accept a F&F so clearing your debt at a lower amount, do they record that as a partial settlement, and does that remain visible on your file? Or does that completely disappear too?
Is there any circumstances where doing a F&F at a lower amount than the total owed negatively impacts your credit file for beyond a 6 year period?
Ta muchly. Thank goodness for this group - it is SO helpful.

Ramble