DIY or DMP?

Challenger71

If we go with a DMP company then we will need to change bank accounts as we have an overdraft and cc with the bank we have been with for 30+ years.

If we contact the other cc lenders ourselves (we are up to date with all payments at the moment just can't stay up to date in the near future) could we continue payments with our bank so that they aren't affected?

Our mortgage is with a different mortgage company and we are up to date with our mortgage.

January2015

We started a DMP with Stepchange and were with them for just under one year before moving over to self-managed. I think, for us, we needed the learning curve of discipline with money (and no access to credit etc) that the first year with SC gave us.

Self-manged is great and more flexible, e.g. we dropped BCard right down to token payments each month to force them towards a default and no interest. We couldn't have done that whilst we were with SC.

I would recommend moving banks and including all debts in your DMP. If you stay with the bank you are with and keep the OD open and keep dipping into it, you are still going to be paying unnecessary fees and charges for that and your other creditors may feel you are not treating them all equally.

We were with our original bank in excess of 25 years when we left them to open a new basic bank account elsewhere. It did feel like a wrench at the time - but in the long run it was best that we made a clean break and started everything afresh.

Good luck with the DMP - whichever way you choose to go.

January2015

Whichever DMP route you choose, I recommend you pop over and read the DMP Mutual Support thread and join the fantastic bunch over there. We are all either working through, or some have completed DMPs. The wealth of experience and knowledge over on that forum is awesome.

Deep_In_Debt

You could always start with say Stepchange and let them do all the initial leg work of setting it all up and then when it's settled, go it alone once you are used to it.

HappyMJ

Challenger71 wrote: »

If we go with a DMP company then we will need to change bank accounts as we have an overdraft and cc with the bank we have been with for 30+ years.

If we contact the other cc lenders ourselves (we are up to date with all payments at the moment just can't stay up to date in the near future) could we continue payments with our bank so that they aren't affected?

Our mortgage is with a different mortgage company and we are up to date with our mortgage.

A DMP is an informal arrangement. You do not need to move banks.

I personally prefer the DIY approach myself but I do give credit to the charities that assist setting up an appropriate plan. Some creditors just won't deal with you if you aren't seeking the advice of a debt charity so you may be forced to go with a debt charity.

Try and avoid "companies" they tend to charge a fee which doesn't help in reducing your debt.

Challenger71

HappyMJ wrote: »

A DMP is an informal arrangement. You do not need to move banks.

I personally prefer the DIY approach myself but I do give credit to the charities that assist setting up an appropriate plan. Some creditors just won't deal with you if you aren't seeking the advice of a debt charity so you may be forced to go with a debt charity.

Try and avoid "companies" they tend to charge a fee which doesn't help in reducing your debt.

I thought that the overdraft and the cc with the bank would be included in the dmp which would mean needing to move banks. I thought we had to make sure we didn't favour one creditr over another.

Puzzcat

Hi,

If you do a dmp through Stepchange then yes you will need to include all your debts including your od and cc with your current bank. I owed 33% of my debt to my bank with a loan, cc and od and was with them for over 30 years.. I don't expect they knew my name and they have been no hassle with my dmp.

Please do as suggested in one of the replies you have had and try to read through the dmp mutual support thread as lots of information on there for you.

I started with SC and am now self managed, I needed someone to hold my hand (in the literal sense) at the beginning but am now more than able to control my debts and deal with creditors.

Don't rush into starting the dmp, you will need an emergency fund so you should advise your creditors you are intending to start a dmp and pay a token payment for each month until set up a £1 is fine. You can do all this by letter and I will pop up a template on the dmp mutual thread that you can use if you like. I did this for 3 months before starting the dmp with sc.

See you over on the best thread on mse.....!

Puzz. x

Challenger71

Puzzcat wrote: »

Hi,

If you do a dmp through Stepchange then yes you will need to include all your debts including your od and cc with your current bank. I owed 33% of my debt to my bank with a loan, cc and od and was with them for over 30 years.. I don't expect they knew my name and they have been no hassle with my dmp.

Please do as suggested in one of the replies you have had and try to read through the dmp mutual support thread as lots of information on there for you.

I started with SC and am now self managed, I needed someone to hold my hand (in the literal sense) at the beginning but am now more than able to control my debts and deal with creditors.

Don't rush into starting the dmp, you will need an emergency fund so you should advise your creditors you are intending to start a dmp and pay a token payment for each month until set up a £1 is fine. You can do all this by letter and I will pop up a template on the dmp mutual thread that you can use if you like. I did this for 3 months before starting the dmp with sc.

See you over on the best thread on mse.....!

Puzz. x

Thank you, that would be very useful. x

sourcrates

Good advice from puzz above, don't rush into things, you will need an emergency fund putting together, as you will have no access to credit, should a drama crop up in the near future.


Personally I would open a new basic bank account, with a bank you have no debt with, so you can include ALL your debts, regardless of weather you choose to go with a debt charity, or self manage.


As mentioned before, steer clear of limited DMP companies who charge you fees, they are bad news, and cost you money.


DMP mutual support thread is good bed time reading, going through it from the very beginning will just about cover any questions you could ever have on the subject.