DMP - Manged v Self-Managed: Pros and Cons

DrWatson1

i'm currently on a DMP with Stepchange, and I'm considering going self-managed.

My current situation is I'm a homeowner with roughly £75k equity in my house, and £32k of unsecured debt, spread across 8 creditors.

I'm currently paying each creditor £5 per month, and in the meantime i'm working towards saving as much as I can each month to begin offering F&F settlements. I have CCA'd all the accounts (unfortunately most appear enforceable), I have around £10k in savings, and expect a significant hike in my income in around 2 years.

So my question is, what are the pros and cons of self-managed? Would creditors take a more aggressive approach in pursuing debts if you're not with a DMP, especially when i'm paying so little each month relative to the debt? If so, what additional measures might they take??

sourcrates

Hi,

Makes no difference if you go through a debt charity, or go self managed, creditors must treat you fairly, so there should be no difference in how they treat you, they only tell you to get advice remember, they don't say stepchange must run your DMP.

As long as you take advice then your cooperating.

It's like anything you do yourself, you have control over who gets what and when, it's not difficult to submit a budget, and press buttons on a keyboard, which is essentially all you do.

If a creditor takes legal action, there decision to do so won't be based on who clicks the keyboard button every month to make payment, it will be to secure there rights over what you owe them, so a decision to manage your own DMP won't have any effect on how the creditor treats you.

January2015

As someone who was with SC and moved to self-managed a year ago, I can confidently advise all our creditors treated us just the same as when we were with SC.

For me, moving to self-managed was about having more control over the amounts we paid, the direct contact with creditors (no middle man in the form of SC). As and when we hit bumps in the DMP road we just notify creditors we will be reducing payments (we don't ask them, we tell them). They have been perfectly fine with that when it's happened. I used to feel as if I had to ask permission from SC and explain every detail.

The amount we pay allows us to save towards F&Fs. We've already tried offering but no-one wanted to deal at the level we could afford, so we will plod on and try again in the future.

DrWatson1

Okay, thanks for the input.

One thing that I do find slightly odd is why creditors don't apply for CCJ's or charging orders more frequently than is apparent for people on a DMP? is there a downside that I'm not aware of for creditors if they take this route??

sourcrates

DrWatson1 wrote: »

Okay, thanks for the input.

One thing that I do find slightly odd is why creditors don't apply for CCJ's or charging orders more frequently than is apparent for people on a DMP? is there a downside that I'm not aware of for creditors if they take this route??

If the debtor simply doesn't have the money, where is the benefit to the creditor in spending more money taking legal action ?

Also the courts expect creditors and debtors to come to an amicable arrangement without involving the courts, by agreeing a DMP that's what your doing.

It's usually only accounts that are sold to debt purchasers and that are ignored, that get judgements in court.

DrWatson1

Okay thanks for the advice. To be honest, I'll only consider going self-managed if a significant amount of my debt comes back unenforceable, as obviously StepChange will not discriminate against creditors.