Advice: DMP VS Bankruptcy

Akpatel94

Hi, Far as i know both DMP and Bankruptcy lasts for 6 years on your credit file.

I am currently in debt of around 16.5k, due to a bad addiction. I am currently a full time student.

I am currently on a DMP paying what i can afford. However Due to my credit score being extremely poor i now have a basic bank account and unable to get credit.

I currently have no assets to my name.

I am just wondering would it be best to go down the bankruptcy root, rather than being on a DMP. As both will not allow me to gain credit in the short term.

StopIt

Seek advice from a debt charity like Stepchange or the National Debtline. Both can advise you on your situation.


Bankruptcy may well be an option but don't do anything without proper help, including help with how you get into this debt if it was any form of addiction.

Pixie5740

Akpatel94 wrote: »

Hi, Far as i know both DMP and Bankruptcy lasts for 6 years on your credit file.

That's not quite correct. A DMP isn't recorded anywhere on your credit files as it's an informal agreement between you and your creditors. It's the defaults that will remain on your credit file for 6 months. Bankruptcy can follow you around longer than 6 years. For example, if you apply for a mortgage in the future then you may be asked if you have ever been bankrupt. This won't necessarily preclude you from getting a mortgage though.

Akpatel94 wrote: »

I am currently in debt of around 16.5k, due to a bad addiction. I am currently a full time student.

For that level of debt a Debt Relief Order might be a better option for you rather than a DMP or bankruptcy.

Akpatel94 wrote: »

I am currently on a DMP paying what i can afford. However Due to my credit score being extremely poor i now have a basic bank account and unable to get credit.

There's no such thing as a universal credit score, it's what's recorded on your credit files that's important. Why does it matter that you can't get credit at the moment? You have a DMP that indicates that you're not very good at borrowing money and paying it back in accordance with the T&C of the credit agreement so why would you want to borrow more money?

Akpatel94 wrote: »

I currently have no assets to my name.

Makes you a good candidate for a DRO.

Akpatel94 wrote: »

I am just wondering would it be best to go down the bankruptcy root, rather than being on a DMP. As both will not allow me to gain credit in the short term.

As about a DRO is probably more suitable for you. Fill in Step Change's Debt Remedy Tool to find out.

Gaz83

Why are you so desperate to get credit? What makes you think that a lender would want to loan you money?

mrmagooooooo

Gaz83 wrote: »

Why are you so desperate to get credit? What makes you think that a lender would want to loan you money?

I dont think the op is desperate to get credit they were just pointing out that they cant.

Anyway i think Pixie5740 has pretty much got everything spot on here :beer: