DMP advice needed please

nv2k15

Hi


I am in around £25,000 of debt, and I considering entering into a DMP, I just have some questions that I am hoping someone with a bit of knowledge of them could help answer. I have filled in a budget on stepchange, and they recommended a DMP, paying £220 for just over 5 years (£10,000 of my debt is a loan that my parents took out for me, so I just repay them over 5 years).


1.) One of my main concerns is that some or all of my creditors wont freeze interest and charges, which would mean that all I am paying every month is the interest, so I t would never get paid off, and I would be in a worse position than I am in now. What are the chances of this happening? and if it does what would I do? The main one I am worried about is a £2,000 personal loan that I only took out last month, and haven't even made my first payment yet. The interest is 49.9% and the fixed payment should be £123 per month for 2 years.


2.) I cant look into bankruptcy or IVA, as this would affect my job and future career. I am over halfway through a chartered accountant qualification, and am just worried about how this debt would affect my future job opportunities. What are the chances of me getting a CCJ? and does anyone know how this could affect my job or qualification?


3.) What are the chances of me losing my car if I entered into a DMP? If any of my creditors took me to court could they take my car, or force me to sell it?


4) If I decided to go down the DMP route, would it be better to go through stepchange or do it on my own? And do I phone all of my creditors to let them know what is happening?


I will post a SOA, just in case anyone could suggest any alternatives, but I really don't think I have any other options.


Thank you.

HappyMJ

Creditors do not have to freeze interest.

The chance of you getting a CCJ is high. Pay it off in full in under 30 days from the date of judgement and it has no effect on your career.

A creditor can get a CCJ against you then employ a High Court Enforcement Officer to come and get your car to sell at auction.

Do the DMP through Stepchange. It can be done on your own but some banks and creditors will only deal with someone other than yourself. A DMP is an informal debt solution. If they see your SOA and see a car worth more than £2,000 then they might not accept your proposals and go down the CCJ route to get their money back.

Alternative is Bankruptcy. You make payments for 1 year then you are discharged. However, having only taken out new credit last month that time might be extended.

The bankruptcy would only stop you from working in your chosen job until the time you are discharged.

Brightspark87

That isn't true about the job and bankruptcy. It can still be an issue with certain types of employment such as being a charted accountant - even when discharged. Trust me - the struggle I had to get authorised with the fca as an IFA and I didnt even enter DMP let alone a formal debt arrangement. I had monthly meetings, had to explain how and why I had got into debt and my plan for getting out... You need to speak with your employer and your regulator before entering any sort of debt agreement. Its not to put you off - but as someone who understands!

nv2k15

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 4
Number of children in household......... 0
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 1130
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1130
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 200 (living with parents)
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 25
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 100
Clothing................................ 25
Petrol/diesel........................... 140
Road tax................................ 16
Car Insurance........................... 55 (includes breakdown cover)
Car maintenance (including MOT)......... 20
Car parking............................. 15
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 5 (Mobile phone)
Presents (birthday, christmas etc)...... 30
Haircuts................................ 10
Entertainment........................... 60
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 711

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 6000
Other assets............................ 0
Total Assets............................ 6000

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................6700......151.......19.9
Natwest Personal Loan..........2900......133.......28.9
Natwest Overdraft..............1000......12........18.9
Parents personal loan..........9800......188.......6.9
Aqua c/card....................650.......27........34.9
Capital One c/card.............960.......37........34.9
Bamboo Loan....................2000......123.......49.9
Total unsecured debts..........24010.....671.......-

Monthly Budget Summary
Total monthly income.................... 1,130
Expenses (including HP & secured debts). 711
Available for debt repayments........... 419
Monthly UNsecured debt repayments....... 671
Amount short for making debt repayments. -252
Personal Balance Sheet Summary
Total assets (things you own)........... 6,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -24,010
Net Assets.............................. -18,010

sourcrates

HappyMJ wrote: »

The chance of you getting a CCJ is high.

A creditor can get a CCJ against you then employ a High Court Enforcement Officer to come and get your car to sell at auction.
.

The OP would have to default on the CCJ payments first, before the above option would even be considered.

In practice, as long as your paying what's affordable, there would be no point taking legal action against you, in those circumstances it's quite rare.

There are lots of people on this forum in DMP's, and non to my knowledge have been taken to court.

As regards interest and charges, again, although legally, they don't have to, most will stop these when asked to do so.

Puzzcat

I have been on dmp with sc for over 2 years, all interest frozen and no mention so far of any ccj' s! Many of us dmp'ers on the dmp mutual support thread, can't say I have seen any mention of anyone getting a ccj. Also no one has ever asked for the value of my vehicle.

The problem I do see you having is keeping up the agreed payments to your family loan, I pay £200 to my mum but sc only allow me £76 in my budget for it so I have to make up the shortfall from within my budget.

fatbelly

Creditors usually freeze interest on a dmp, eventually

The chance of you getting a CCJ while on a 5-year dmp is low.

A creditor with a CCJ against you cannot employ a High Court Enforcement Officer on a consumer credit act debt - they would have to use the court bailiff as rules stand. They could do an attachment to earnings but may not get any increase in payment so in practice the whole thing would be a waste of their time.

You can do the DMP through Stepchange or Payplan or it can be done on your own, maybe with help from the NEDCAB site.

tallyhoh

have you addressed the problem that created the debts? Your outgoings are fairly low but you took out a loan for £2000 recently?

ladymarmalade222

sourcrates wrote: »

The OP would have to default on the CCJ payments first, before the above option would even be considered.

In practice, as long as your paying what's affordable, there would be no point taking legal action against you, in those circumstances it's quite rare.

There are lots of people on this forum in DMP's, and non to my knowledge have been taken to court.

As regards interest and charges, again, although legally, they don't have to, most will stop these when asked to do so.

Sorry I do not agree that CCJs are rare on a DMP. My sister had been on a DMP with stepchange for 5 years when out of the blue PRA sent a CCJ for a 2000.00 debt.

Stepchange poorly advised her and told to admit everything and agree to the same payment as she was paying on the DMP. She was not clued up and trusted their advice.

The debt was due to fall off her file in a few months but now PRA have gone for the kill, she has a CCJ for the next 6 years and they added nearly 1000.00 in fees and interest to add insult to injury.

She eventually confided in me but it was too late for the
CCJ on her file. The worse thing is they didn't even the correct paperwork but she did not know about sending requests for CCA.

I have helped her cancel her stepchange plan and am helping her self manage. All of the debts we have requested CCA s for so far cannot supply paperwork and I have no qualms in helping her to avoid paying anymore. I would not have had that attitude previously but they have had their money back numerous times over, hounded her on the phone whilst she was ill with kidney failure and this was the last straw.

Stepchange advised her very poorly but considering they are receiving their funding from the banks they are arranging dmps with I don't suppose you can expect them to be on your side.

I know this will ruffle some feathers as Stepchange are praised so much on here and I do understand that they take the weight off the shoulders for many in debt.

All I am saying is please don't get complacent that you are in a DMP and a CCJ is not possible as this shows it is and PRA debt collectors are getting a reputation to go for CCJs.

She tried to do the right thing for the past 5 years, has recently had a kidneys transplant. She cannot wait to get back in the workplace and feel normal again but this means she is ruled out of many jobs she wants to apply for.

Sorry, I am angry:o

sourcrates

ladymarmalade222 wrote: »

Sorry I do not agree that CCJs are rare on a DMP. My sister had been on a DMP with stepchange for 5 years when out of the blue PRA sent a CCJ for a 2000.00 debt.

Stepchange poorly advised her and told to admit everything and agree to the same payment as she was paying on the DMP. She was not clued up and trusted their advice.

The debt was due to fall off her file in a few months but now PRA have gone for the kill, she has a CCJ for the next 6 years and they added nearly 1000.00 in fees and interest to add insult to injury.

She eventually confided in me but it was too late for the
CCJ on her file. The worse thing is they didn't even the correct paperwork but she did not know about sending requests for CCA.

I have helped her cancel her stepchange plan and am helping her self manage. All of the debts we have requested CCA s for so far cannot supply paperwork and I have no qualms in helping her to avoid paying anymore. I would not have had that attitude previously but they have had their money back numerous times over, hounded her on the phone whilst she was ill with kidney failure and this was the last straw.

Stepchange advised her very poorly but considering they are receiving their funding from the banks they are arranging dmps with I don't suppose you can expect them to be on your side.

I know this will ruffle some feathers as Stepchange are praised so much on here and I do understand that they take the weight off the shoulders for many in debt.

All I am saying is please don't get complacent that you are in a DMP and a CCJ is not possible as this shows it is and PRA debt collectors are getting a reputation to go for CCJs.

She tried to do the right thing for the past 5 years, has recently had a kidneys transplant. She cannot wait to get back in the workplace and feel normal again but this means she is ruled out of many jobs she wants to apply for.

Sorry, I am angry:o

Hi,

I'd agree with most of what you've said.

Stepchange operate a "one size fits all approach", and mainly concentrate on just the repayment of debt, rather than the other issues that occur.

You will always get an exception to the rule, PRA group are a law unto themselves.

I'd advise anyone to deal with there debts themselves, and do all of what you've said, CCA the full monty, some can, some can't, the ones who can't are stepchange clients, until they wise up, or gain confidence, there are no guarantees in life, a lot of the time you have to help yourself!!

ladymarmalade222

Thanks Sourcrates.

It was actually your posts that pushed me to CCA everything. If you had asked me a few years ago I would have said if you borrowed it, morally you should pay everything back. Situations change, bad luck, ill health etc. I despise the DCAs for making her life worse than it already was. The CCJ was below the belt when she was keeping her side of the bargain.

We had a letter back today saying they could not trace anything of a loan so could not provide a CCA from the account number we provided. They asked if we could help them with some additional info....errr no
You could see scribbles on a sheet of all the numbers they had tried to attempt to trace it.

Anyway hopefully life is looking up and she said she is not scared of the post arriving anymore.

Good luck everyone xx