Stepchange DMP

Sioonoo

Hi all

I contacted Stepchange for debt advice and was told my two options were bankruptcy or a DMP as I had 34k of unsecured debts for a variety of reasons (but in summary yes I took them out and I was very foolish for doing so) stepchange did an income and expenditure with me and when I was giving them figures said "ohhh that's too high" let's lower that and eventully they came up with the disposable income figure of £629 which is roughly half my salary) but for the 3 months I've paid back the £629 I've ended up borrowing £150 in payday loans (each month) as I was always short by about £150 (I know this is against the terms and conditions... but I need money to get to work) anyway I contacted the charity for civil servants who did an income and expenditure with me and came to a different figure that was roughly £150 different to the one stepchange gave me - he also told me that an IVA should have been offered based on my circumstances (which is the root I'm going down now) my question is this I've never missed a payment on my DMP ....... will my creditors look at that and go "ooooooooooooh he's not struggling he's never missed a payment on his DMP" I'm just really worried when they vote I won't get the 75% and i'll be stuck paying the unaffordable monthly amount of £629 for 6 years

sourcrates

Hi,

You should only pay what you can afford, never mind what stepchange or anyone else says, you could do a self managed DMP.

However, see how the IVA pans out first, your creditors won't be thinking anything about you, it's just a buisness decision they will make, they may ask you to contribute slightly more in order to accept your proposal.

Wait and see is the best advice I can give you, all you need are your biggest creditors to accept and it will be passed.

National_Debtline

Hi Sioonoo,


I agree that I don't think your creditors will be looking at it in that way, but from your point of view there are a few things to consider with an IVA versus a DMP.


With an IVA it will be reviewed annually and the payments can be varied - it is unlikely they will be varied down, but may go up. If you have any property then that can be factored into an IVA through the equity release clause, if your equity is more than your debt level then be very careful about starting an IVA - it may not be suitable. Whilst in an IVA any additional income, bonuses etc. can be taken as part of the IVA as a windfall.


If you decide to shop around for your own IVA make sure you find one that follows the IVA Protocol, it is an elective code of practice that gives you more protection and not all providers follow it. Make sure you do your research because once the IVA begins you are locked in for the duration or risk bankruptcy. Good luck,


Laura
@natdebtline

LMJ10

i dont think Stepchange should be saying that to you and just lowering the amounts!!
i have had to lower my monthly payment recently due to being on maternity leave and also i have had to make just a token payment, some of the creditors have defaulted me that didn't when i started the plan because i have reduced the payment, but my credit report was trashed anyway!!

Sioonoo

Hi all

Thanks for all your replies and help I appreciate it - I spoke to a lady at Aperture (after being referred by a work helpline) she seemed really nice and told me everything to expect from an IVA - I don't have any assets at all I just know that I can't keep paying £629 a month as I've had to borrow further to make the DMP repayments which the lady said should never be the case, I'm still hopeful that the creditors allow my repayment of £300 a month - I do want to try and repay the debt I just can't afford £629 a month

ladymarmalade222

Apeture seem to be a paid for service that only offer IVA's so they would recommend this.

Please get further advice to get a non biased option.

MyLastFiver

I'm still hopeful that the creditors allow my repayment of £300 a month

A couple of things:

1. So you were paying £629 but were consistently £150 short? Then you did another SOA which calculated your payment at £150 less? That sounds like an affordable payment is £479?

2. In a DMP it's not up to your creditors to "allow" or "not allow" any payment. They are entitled to take legal action to enforce their debt, but they are extremely unlikely to do so if you're paying £479 (or even £300) each month off a £34000 debt.

Given the level of payments you're able to make, I can't see why you'd need an IVA, and would suggest, on the limited info given, you give some serious thought to continuing your DMP.

And I'd be very wary of entering into anything with Aperture.

Gazza1964

Hi

I don't know anything about IVA's so I cant comment. I will say that Stepchange are usually very good and I would speak to them about the situation you are finding yourself in.

If you cant mange on the budget you have worked out with them then tell them you want it reviewed. There is no point carrying on the way you are you need enough money to live on plus you need to salt away a couple of quid each month for emergencies.

Perhaps you forgot to tell them about the £70 you spend each month on fags or something similar......

blisteringblue

Stepchange while a godsend for some are very regimented. It's your DMP you should be able to dictate what you pay. £150 short each month it isn't working.

Have a look here https://nedcab.cabmoney.org.uk/dmp.asp and look at running your own DMP. You can then pay as much as you can afford. Even if it is £1 a month while you build an emergency fund.

Stop beholding to your creditors about what they will or will not accept. If you haven't got it they can't have it.

I would start self managed and work your own DMP on the £450 you have for your debts.