What should I do????

LoonyTunes_2

Hi,
Please can I have some advice from all you money savvy experts. I've been lurking in the wings for a while and have finally taken the plunge to say HELP- what should I do ????.
I am a single parent and my son is in full time education with one more year to go after this one.
In a nutshell I have been diagnosed with a long term illness and I have lost my job because of this. Prior to this I was living way beyond my means and built up credit card debts. My change in circumstances has been a real LBM for me, I have stopped spending on the cards, now do a spending diary, try to stick to a budget, renegotiated all my outgoings for the best deals etc etc-all the advice I have gained from you knowledgable people.
I have £10000 in credit card debt;
Debt 1-£5500- currently on hold until spoken to step change-was paying £100 per month at 3%
interest on a plan.
Debt 2-£2500- currently on a plan paying £25 per month with no interest.
Debt 3-£2000- interest free period just finished now paying about £20 per month interest-have spoken to them to explain my situation but they would not reduce interest or let me go on a plan.
I have my bank account and mortgage with debt three bank.

I have spoken to step change in depth, done a SOA and worked out that I have£157 per month to pay off my debts (which is doable at present). They suggest I should do a DMP with them for this amount.

I am worried because when my son leaves college I will lose my maintenance,child tax credits and child benefits and only have ESA coming in (I applied for PIP but was turned down).
I am worried about having to change bank accounts so that I am not banking with same company as debt three and about the impact it will have on my mortgage. I have been wondering if I should plough all my spare money into paying off debt three ASAP and then concentrate on the other two debts or maybe then do a DMP, or whether I should bite the bullet and do a DMP now and save any spare money incase I am not well enough to get a job of some sort by the time son leaves college. I've checked my credit score on noddle and it's bad, all my other bills are paid up to date. What would you do????
Sorry for the very long post.

Scottishmummy

Our mortgage is with a bank that we had three debts with. Putting those debts into a dmp didn't make any difference to the mortgage. That has carried on exactly the same as before. As for the bank account well that was one of those debts due to being unable to repay the overdraft so that was closed and we opened a basic account with Nationwide. As long as you open a basic account with no overdraft facility while on a dmp you should be okay.

I can't help with info regarding the benefits except I would be concerned that you might lose the tax credits earlier than that if you are no longer working. I would presume you need to let them know now because the last thing you want is to end up having a debt to them too if it turns out they have overpaid you.

LoonyTunes_2

Hi Scottishmummy,
Thanks for your reply, I have spoken to the tax credit people- I only now get child tax not working tax credits. Thanks for your advice

[Deleted User]

Did you appeal the refused PIP?

LoonyTunes_2

Hi Venison,
I'll be kind to you, I'm new too!!!
Yes I did appeal, but that was also turned down, due to being unwell I did not try to take it any further. Thanks for your reply.

andyfromotley

we really need to see an SOA to give useful advice.

http://www.stoozing.com/calculator/soa.php

Stepchange are great and to be fair their advice is usually spot on. Dont worry about future developments, if your circumstances change your DMP can change.

LPMS

I would go to your local Citizen's Advice for further advice regarding PIP. You may have to reapply for it, and then take your form to the CA and they can help you fill it in.

LoonyTunes_2

Thanks andyfromotley and LPMS for your advice. My main question is should I go with step change and their DMP plan or try to manage it myself ?

Scottishmummy

LoonyTunes wrote: »

Thanks andyfromotley and LPMS for your advice. My main question is should I go with step change and their DMP plan or try to manage it myself ?

If you are comfortable dealing with your creditors then why not try yourself. We are only now going self-managed after being with SC for a few years because we got fed up with all the phonecalls at the beginning. It was so much easier letting SC handle it but we had 13 creditors.

LoonyTunes_2

Thanks Scottishmummy, I think I'm getting myself in a state because I'm scared of making the wrong decision, that's why I posted on here to get other peoples opinions and advice.

Scottishmummy

LoonyTunes wrote: »

Thanks Scottishmummy, I think I'm getting myself in a state because I'm scared of making the wrong decision, that's why I posted on here to get other peoples opinions and advice.

If you are anxious about it all then let SC deal with it, at least for the first year anyway. You will get phonecalls - many phonecalls - but just give them your SC account number and tell them to get in touch with them only or by letter only to yourself. If they continue to call they can be reported for harassment. Once it is up and running, interest frozen etc and they have been receiving your reduced paments for a while, if you feel like taking over then go ahead, if not let SC continue. At least they are not charging for their service.