A couple of questions for those who run their own DMP

purpledelly

I am very organised and do all banking online etc, and as I already know exactly which creditor should get what then I think I should be fine. I admit it has been handy on the odd occasion one of the creditors has phoned asking us if we can up our payment, to be able to just refer them to the CCCS, but in reality this hasn't happened at all for well over 18 months - they all seem to accept our offer.....
Thanks again all of you - people on here are so lovely!

pinkkat8910

purpledelly wrote: »

Thank you so much Pinkkat - that answers a lot of my questions too. I'm going to look at how much difference it would make to us cash-flow wise and chat to hubby about it and I think we'll go for it!
Thanks

No worries at all - if you need any help give me a shout ... it is daunting when you first set up your own DMP but it pays in the long term!

Good Luck!! :j

Spendaholic_Chick

Big question - what are the steps in setting up your own DMP?

And what are the pros / cons?

I've never looked ino a DMP at all but I never knew you could do them yourself, which makes it more appealing somehow.......

pinkkat8910

Spendaholic_Chick wrote: »

Big question - what are the steps in setting up your own DMP?

And what are the pros / cons?

I've never looked ino a DMP at all but I never knew you could do them yourself, which makes it more appealing somehow.......

Hi Spendaholic,

The process is exactly the same as doing it through CCCS or Payplan. You write to your creditors yourself with your SOA and offer a reduced payment on a pro rata basis against the level of debt each creditor takes.

Once you have agreed a reduced payment its simply a case of paying each creditor individually as opposed to a lump sum to one company who will make the payments on your behalf.

This website explains it well
http://www.debthelpuk.co.uk/faqs/dmpfaqs.htm

The pros are that you are in control of your finances and know exactly whats being paid to who and when. If you have any spare cash one month you can put it on a card without any questions - I've paid off my smaller creditors by doing this

The cons are that its more stressful for you initially upon set up of the DMP. You cannot palm it all off to a third party, you have to deal directly with each creditor to come to an agreement, but really once you've done that you're laughing

Would recommend it to all after having been with a third party and being really disappointed with the service I took on the dmp myself and have had no problems since - I never hear from my creditors anymore (which is a great sign!!!) whereas when I was with Payplan I was inundated with letters and phone calls as no one was paid on time, despite the fact they took the money from my account on the same day of every month

Hope that helps!

purpledelly

Hi Spendaholic

I obviously haven't set up my own yet, but I can tell you how it went with the CCCS as those steps would be what you'd have to do yourself too. I'm guessing you'd be starting from scratch and have no kind of agreement with your creditors already?

In which case - first step is to visit any of the websites mentioned in this thread - and the CCCS included and download some of their forms to write down your income/expenses/creditor details - SOA basically.

This will tell you how much you have spare each month to offer creditors. Be sure you to allow yourself enough to live on without seeming to be spending loads on luxuries or they will reject it.

Then work out how much you can afford to pay each creditor. The way the CCCS et al work that out is to work out as a percentage, how much of your total debt each creditor (or each debt if you have more than one debt with a creditor) is worth. Then they take your surplus income and divide it up accordingly (so for example if Capital One was 20% of your total debt they would be offered 20% of the total amount you have to pay).

Write this all down - how much you can afford and how much you can pay each creditor and send the whole lot with a letter and your SOA to each creditor asking them to accept.

There is more to it than this - i.e. you need to carefully word the letter and request they stop interest etc and also outline why you can no longer afford the debt (the templates and websites mentioned will help you with all of that).

Then you'll find out if they accept or not (most seem to if it is reasonable what you're offering). All of ours stopped interest. Some get passed on to debt collection agencies but that's not a huge problem usually.

I've written loads so I won't overburden you with more here but do ask, because there are lots of other things to consider and look out for....
And most important get yourself another bank account if you have any debts with your current back because they will take all your wages etc to pay your debt with them if you keep it there AND once you've gone through the DMP route you will find it hard to get a regular bank account so the earlier you do that the better.

Hope that gives some food for thought... but I know others here will be really helpful too.

Spendaholic_Chick

Thanks for explaining it to me, both of you! I'm undecided if this is the route I want to take, but at least now I know wat it involves and can think about it.

Good luck with yours, Purpledelly!

rayday2

For more information there is a pack you can download off the national debt helpline website that contains all the information you could need.

I never felt I was alone following this pack and I know exactly what is happening with all my debts and I feel that I am in some way still responsible I personally would not be able to leave my problem at someone elses desk and sleep well at night but I am a kind of person that likes to organise and know exactly what is happening all the time aka control freak!