DMP & Mutual Support Thread - Part 11

Puzzcat

Ariel82 wrote: »

Hi Kid,
I made the minimum payments last month and applied to stepchange, my first Dmp payment is Dec 1st but I guess stepchange hold onto it for a few days to get their interest. So I'm only now starting to receive the "please pay us" texts calls and letters, I'm now thinking I should have left it a bit longer but unless I go it alone then it's too late about that now.
I did send the £1 token payments to all a few weeks back. Maybe I'm just panicking?!

If your first payment to sc Isn't due until 1st Dec then you could still ring them and ask for a later set up, don't forget to send token payments £1 with a covering letter to all the creditors for each month until the proper start up. I did 3 months token payments to get my car repairs done and save a small emergency fund.
Puzz.x

Ellieseleven

carbootcrazy wrote: »

This may seem a dumb question, sorry if the answer is obvious and I've failed to see it:o

Suppose the time comes when well into a DMP that the monthly payment to various creditors is more than what the minimum payment would normally be with that outstanding balance when not on a DMP. Will they start charging interest again as it looks as if the debtor can easily afford the payment? In other words, does interest, once frozen,remain frozen for the length of the DMP?

Sorry, not explaining it very well but I know what I mean:o

This is something I have often wondered about. I am now into my 6th year on a DMP and all my credit cards (apart from BC) have been defaulted and passed to DCA's so I don't think they start re-applying interest.

Our BC's (one mine and one OH's) don't currently have any interest being applied (being reported as AR) and we are both now paying over the minimum payment. This is one reason why I keep quiet and don't want to rock the boat by asking for defaults on these accounts whilst they are at 0% interest.

From other posts BC don't appear to have any guidelines for payments, I have read somewhere that once over 1% of balance then interest may be re-applied but we are paying over 3%...confusing:(

Ellie xx

Brogden

Ellieseleven wrote: »

This is something I have often wondered about. I am now into my 6th year on a DMP and all my credit cards (apart from BC) have been defaulted and passed to DCA's so I don't think they start re-applying interest.

Our BC's (one mine and one OH's) don't currently have any interest being applied (being reported as AR) and we are both now paying over the minimum payment. This is one reason why I keep quiet and don't want to rock the boat by asking for defaults on these accounts whilst they are at 0% interest.

From other posts BC don't appear to have any guidelines for payments, I have read somewhere that once over 1% of balance then interest may be re-applied but we are paying over 3%...confusing:(

Ellie xx

I believe you are completely correct Ellie It's painfully confusing and there is absolutely no answer to the question except that it would seem to be extremely unlikely that once interest is stopped that it would ever start again. If we are lucky enough for the debt to be sold the chances of it happening must be virtually zero, no matter how much we pay.

This whole thing is a complete pig's breakfast :mad: !! BC make it up as they go along - are they really going to monitor payments on a troubled account for years in case the poor debtor pays a bit too much one month and they get the chance to charge interest again? Don't mention it to them though......some career climbing young fake might think it's a good idea and get a work project signed off for it,,,,,,,promotion and payrise on the way:rotfl:!!!

I don't know if Puzz could update us on the PRAT group sometime? Has it finally officially defaulted Puzz? There isn't any interest charged now is there? Puzz can rock my understanding !!

B

2spicy

cat1978 wrote: »

Hi everybody, long time lurker here.......

So my question is, how should we go about making settlement offers? My oh has finally sold his house and hopefully we should receive the money from the solicitors in about 10 weeks (dependent on oh ex signing all required paper work).
Can we start to get figures now so we are prepared? And do we do it via phone or letter?

Thanks

Do everything by letter. If you want to call them, make sure you speak to the correct people as the frontline staff usually have no powers to negotiate.
If you are intending making reduced offers in Full & Final Settlement, I can give you a formula and a template to use ... or you can talk to your DMP company and tell them how much cash you have to play with and see if they would be willing to negotiate settlements. The ball is pretty much in your court, you have the upper hand

cat1978

Thanks for your response 2spicy, the offer of the template etc would be a fantastic help - I'm getting excited at the thought of clearing oh debt instead of the projected 45 years it currently is (bearing in mind that he's 47, so think 92 before it was originally going to be cleared might have been pushing it :eek:)

:j:j

2spicy

Hope this helps ... I had this letter sent to me many years ago by another member of the forum. its probably buried deep inside Thread 2 or 3 !...

The basic rule of thumb is if yoru going to make offers of F&F settlement, start around 40% of the remaining debt and negotiate with the creditor. Some will play ball, others wont.

Formula

Lump sum available × each debt

÷ the total amount you owe to your creditors

= offer to the creditior

Example

You may have £10,000 owing to four creditors. You can raise a lump sum of £4,000.

You owe:

• £2,300 to Mastercard
• £1,200 to a catalogue company
• £4,500 to a loan company
• £2,000 to the bank

Use the formula

£4,000 (lump sum available) × £2,300 (debt to mastercard)

÷ £10,000 (the total amount you owe to your creditors)

= £920 (offer to mastercard)

Your offer to Mastercard is £920. You then do the same calculation for each creditor, using each individual debt in the calculation.

Your offers to your creditors should look something like this:

Offers to creditors based on a full and final settlement of £4,000

Creditor

Debt

Full and final settlement offer

Creditor £10,000 £4,000
Mastercard £2,300 £920
Catalogue £1,200 £480
Loans £4,500 £1,800
Bank £2,000 £800


Remember
[FONT=&quot]Do not pay the lump sum to any creditor that does not agree your offer in writing.[/FONT]


The letter ..

This is a type of offer where you ask the creditor to accept part of the amount you owe and write off the rest.

(Your home address)

Date

To:

Without prejudice

Dear Sir/Madam
Account No:
I/we write with reference to the money which you are claiming on the above account.
I/we can confirm that I am/we are unable to offer to pay the money which I/we owe in full (add details of your circumstances and financial situation). However, I/we can raise £(put the amount which you can afford to pay) and I/we want to offer this as an ex-gratia payment in full and final settlement of the account. This offer is made on the clear understanding that, if accepted, neither you nor any associate company will take any other action to enforce or pursue this in debt in any way whatsoever and that I/we will be released from any liability.
I/we also request that, if accepted, you will make an entry on any credit reference agency file relating to the above account as having been paid and the account closed.
Payment can be made within (put the number of days or weeks within which you will pay) of receiving your written agreement of this offer and method of payment.
I/we look forward to receiving your reply.
Yours faithfully
(Your signature)

cat1978

That's amazing, thank you so much , now we just need to wait for money. It's going to be a long 10 weeks

stormpassing

Just wanted to share, got my letter from Barclays today (re: current account overdraft) accepting offer of mothly payment. The outstanding balance was £12 more than expected. T/C made to Barclays Recoveries team to enquire what this was. Spoke to a lovely lady who said that the charge was applied after they had received the offer from StepChange so would request authorisation from her Manager to remove it. I was placed on hold for a couple of minutes and then advised that the £12 had been refunded

Well worth a phonecall I'd say :T
SP x

2spicy

stormpassing wrote: »

Just wanted to share, got my letter from Barclays today (re: current account overdraft) accepting offer of mothly payment. The outstanding balance was £12 more than expected. T/C made to Barclays Recoveries team to enquire what this was. Spoke to a lovely lady who said that the charge was applied after they had received the offer from StepChange so would request authorisation from her Manager to remove it. I was placed on hold for a couple of minutes and then advised that the £12 had been refunded

Well worth a phonecall I'd say :T
SP x

Well done. Ive always maintained ... Never bury your head in the sand and refuse to talk to your creditors .. Most are understanding and, can be approachable / negotiated with.

blisteringblue

Brogden wrote: »

I don't know if Puzz could update us on the PRAT group sometime? Has it finally officially defaulted Puzz? There isn't any interest charged now is there? Puzz can rock my understanding !!

My BC went over to PRA Group, I am paying them now and it disappeared from my Noddle Account a couple of months ago, only to turn up in this months as an "other account" and in magic red letters "DEFAULT".

I think the cogs whirr slowly but anybody moving to PRA should get defaults eventually, although Puzz did speak to them I think and they tried to imply the default wasn't always automatic?

BC handle this so poorly though.