Is BR for me?

Teddyuk85

Thanks to all of you for your advice.

I've been recommended a DMP.

On paper it works for me. However I am worried if the creditors turn around and don't agree....what's the implications of this.

I am scared it means so much I don't know what would happen

dundermifflin

It is very rare for creditors to refuse payments offered in a DMP. As long as you don't favour one creditor over others, then you will be fine. The payment you make to the debt management company/charity is then shared out pro-rata to the size of the debt.

For example, if you paid £100 for your DMP each month, and you had £10k total debt which included a credit card that owed £5k (50% of your total debt), and two loans for £2.5k (25% each of your total debt), then the credit card company would get £50 (50%), the two loan companies would get £25 each.

Don't worry at all, most creditors are used to DMPs, it's not something new or unique. As long as you keep up the payments, and you've offered a reasonable amount to them through the DMP company/charity then there's no reason why they would refuse it.

Just be aware that (as far as I remember), there is no legal obligation for creditors to freeze interest (although most will freeze interest at some point whilst you sort things out with your DMP).

mwarby

In a DMP are you going to treat all creditors equally, including your mum ?

If not I can imagine the other creditors not being to happy. I'm not 100% but if this failed and you went bankrupt the OR would possibly seek the preferential payments made to your mum back

Teddyuk85

Unfortunately in my financial situation I don't really have a choice.

I have just prepped all my DMP details to be sent off.

I just have to hope for the best really.

Teddyuk85

Also I forgot to mention, my loan to my mum ends in 15 months. The advisor at debt change just told me this payment would then be put towards my creditors once I have paid her.

fatbelly

A dmp does sound like the way forward for you. But review everything in 15 months.

I was also a bit concerned about the car. If it's on HP it's not yours and in bankruptcy you would probably lose it unless a third party picked up the payments.

The dmp can be built around that as it's a less formal solution. In 15 months the car will be yours, you will have less debt, more surplus income and you can look at everything again.

I doubt bankruptcy will be your best strategy even then but it will be worth looking at