Advice on debt management or DMP

toffees26

Hi I am new to posting on a forum so please bear with me. My husband and I owe money to 11 different lenders, including 2 loans. credit cards, Next, Very and overdrafts. We are just making the minimum payments on each debt and not defaulting on any debt or other bill. We have looked into a DMP with Stepchange but I have a niggly reservation about this.
The two loans will be clear in 4 years and Next, Very, overdrafts are low debt which again would be cleared ion 6-12 months.
We have set up a very tight budget and reviewed all our outgoings and are in the process of changing broadband supplier and closing sky etc.
My question is would we be better contacting the credit card companies and asking them if we can make a smaller payment each month until we are financially more stable (my husband will be having a pay rise in 12 months and from September I will be able to look for a second job) or should we pursue a debt management plan?
I am very stressed about the situation and I am fully aware that we have bought this on ourselves and in some ways feel relieved that we are facing up to it and making positive changes.
Advice would be really appreciated.
many thanks

another_casualty

Well done on facing up to the problem .
I would imagine somebody will ask you to fill out an s o a which is on this site somewhere.
I'm on a d m p . If you go down that route , you are basically blacklisted for 6 years? I'm not sure if the same applies , if you write directly to the lenders as you are thinking of doing .
The good thing about a dmp, is that someone like step change / Payplan will assess your budge situation and give you a fixed sum to pay each month , and you are then assessed once a year .
Hope that helps
Good luck

sourcrates

Hi,

Your plan is a good one, however the credit card companies usually only allow payment arrangements set up by them, for short periods of time, somewere in the region of 6 months or so.

If it's going to take you longer than that to clear the debts then a debt management plan is the way to go.

Have a look on the stepchange website for more information, and maybe think about posting an SOA (statement of affairs) using the stoozing calculator available from the stickies.

toffees26

Thanks for your reply. Are you happy with how your DMP is going? I worry about being chased for non-payment and having demands for payment we will not be able to make. I think a DMP is probably the way forward. Did you have to change bank accounts?
Thanks

toffees26

sourcrates wrote: »

Hi,

Your plan is a good one, however the credit card companies usually only allow payment arrangements set up by them, for short periods of time, somewere in the region of 6 months or so.

If it's going to take you longer than that to clear the debts then a debt management plan is the way to go.

Have a look on the stepchange website for more information, and maybe think about posting an SOA (statement of affairs) using the stoozing calculator available from the stickies.

Thanks for this, we have looked at stepchange and will complete their online form over the weekend. With the SOA is this something stepchange will want as well or for our own use? Sorry its all a bit foreign!!
Thanks again

another_casualty

toffees26 wrote: »

Thanks for your reply. Are you happy with how your DMP is going? I worry about being chased for non-payment and having demands for payment we will not be able to make. I think a DMP is probably the way forward. Did you have to change bank accounts?
Thanks

Yes, you need to change your bank account to a bank which is not part of the creditors that you owe money to.
Payplan have been very good to me so far. No complaints.

If you do go for a dmp, just remember to keep up the monthly payment that they tell you . A year later, you will get a review, and they will determine how much you pay etc . Same thing applies each year.
Best of luck in what you decide

sourcrates

toffees26 wrote: »

Thanks for this, we have looked at stepchange and will complete their online form over the weekend. With the SOA is this something stepchange will want as well or for our own use? Sorry its all a bit foreign!!
Thanks again

It's standard practice for everyone because without one, it's impossible to determine a debt solution for you that works.

enthusiasticsaver

If you are unable to make minimum payments then a DMP may be the way to go. How much do you owe?