We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
Debt Managment Plans - How do they work??
ScorpioLady_2
Posts: 123 Forumite
Sorry about such a basic question, but can someone please explain how they work?
Everyone seems so much further down the line and I can't seem to find a thread explaining how they work from scratch. (do you pay all your money over to the company ie CCCS and then they distribute it????, who pays utilities? How do you get your groceries?)
Plus if going on a DMP ruins your credit rating ( ie defaults) would it be beneficial to lump everything onto just one CC resulting in just one default (as opposed to the possibility of 3 defaults?) (looking on the black side!!!)
Apologies for such a stupid questions.:(
Everyone seems so much further down the line and I can't seem to find a thread explaining how they work from scratch. (do you pay all your money over to the company ie CCCS and then they distribute it????, who pays utilities? How do you get your groceries?)
Plus if going on a DMP ruins your credit rating ( ie defaults) would it be beneficial to lump everything onto just one CC resulting in just one default (as opposed to the possibility of 3 defaults?) (looking on the black side!!!)
Apologies for such a stupid questions.:(
0
Comments
-
Hi
This just depends on how much debt you have got ?
Yes you do just pay all your money to cccs, but before they take the money they take into consideration your bills, food, mortgage etc.
and only pay what you can afford,
,
yes it does ruin your credit rating but that is the least of your worries, because you won't be going for a loan, credit card untill you have paid your debt off.
massey0 -
DMPs are about dealing with your unsecured debts.
The first step is to work out a budget (basically an SOA which I would suggest you post here and get feedback .
The budget will list all your essential spends like mortgage/rent, secured loans, council tax, utilities, groceries, clothes, car costs etc etc . which you still need to pay yourself.
After allowing for these, the remainder is then avaialble to pay off your unsecured debts.
If it is sufficient then CCCS / Payplan will arrange a DMP for you. You will then pay the debt money to Payplan/CCCS who will send the money on to each of your creditors.
But first step is to work out your SOA.
Because you will not be paying the contracted amounts on your debts then your creditors will probably default your accounts.
Do not transfer all your debts to one creditor... the creditor will rightly be very very unhappy about that.0 -
Hi there,
You can find some more detail about DMP's on our webisite.
http://www.cccs.co.uk/faqs/FAQAnswers.aspx?GUID=882e1f30-ff1d-4e6e-b276-0712a053f1f6
Hope this helps
CCCSI am a Debt Counsellor that works for the CCCS and have specific permission from Martin, to post on these boards to try and help those in debt. Read more information on the CCCS and what it does in the Debt Problems: What to do and where to get help article.
CCCS is a registered charity, and there is no charge whatsoever for any of the services we provide to our clients. We take great pride in offering first class help and advice, but we only offer this where we have been able to fully explore and understand your circumstances with you. We want to help you understand these choices and their possible implications but not make them for you.0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 349.9K Banking & Borrowing
- 252.6K Reduce Debt & Boost Income
- 453K Spending & Discounts
- 242.8K Work, Benefits & Business
- 619.6K Mortgages, Homes & Bills
- 176.4K Life & Family
- 255.7K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 15.1K Coronavirus Support Boards