DMP Mutual Support Thread - Part 12

Comingupforair

Good day folks.

After years of refinancing, misplaced stupidity and blind optimism I've finally taken the step to turn around and face the tsunami that I've been trying to outrun.

I have 7 debts across 5 creditors (totalling 20,000) and having made contact with step change they've suggested a dmp of 250 for 6 years and 9 months.

I've stalled at this step as I'm terrified of the creditors rejecting the offer, I guess I'm reaching out for reassurance that I've got to hold my head up and follow step changes advice.

At the moment I feel a shadow of my former self due to these collective worries spilling over and having an impact on other areas of my life.

I am confident that my situation can and will improve I just need to take this stiff on the chin for now.

Thanks for listening, needed a place to get this all out of my head.

Gill42

Hi newbie thinking of taking out a DMP I've read some of the posts on here and have a few questions I couldn't read it all as there 192 pages to get through. A lot of people saying about f+ f what is that and letting your payments go into default. I'm up to date with all my creditors at the moment. Scared to let anything go into default. And many saying about saving money. Waiting on my pack to come through. Need to set up new bank account but all bank accounts I've looked say they will move and my wages etc over the close down my old account as one of my debts is my overdraft I'm worried the bank will stop new bank from moving over my wages and then I will have to go without for a hole month .. Any help would be great..

Gill42

Can I ask if you have gone into default on your debts? I'm up to date but reading through here and a lot saying to let it go into default save the money for a rainy day. To scared not to pay my debts.

sourcrates

Gill42 wrote: »

Hi newbie thinking of taking out a DMP I've read some of the posts on here and have a few questions I couldn't read it all as there 192 pages to get through. A lot of people saying about f+ f what is that and letting your payments go into default. I'm up to date with all my creditors at the moment. Scared to let anything go into default. And many saying about saving money. Waiting on my pack to come through. Need to set up new bank account but all bank accounts I've looked say they will move and my wages etc over the close down my old account as one of my debts is my overdraft I'm worried the bank will stop new bank from moving over my wages and then I will have to go without for a hole month .. Any help would be great..

Gill42 wrote: »

Can I ask if you have gone into default on your debts? I'm up to date but reading through here and a lot saying to let it go into default save the money for a rainy day. To scared not to pay my debts.

Do not use the banks switching service.

You need a basic bank account with a bank you have no debt with.

All credit payments should ceace whilst you save up an emergency fund, defaults are good as they give you a clear 6 year Window till they drop off your file.

DMP land requires a new way of thinking, its about taking control and being pro active about your debts.

sourcrates

Comingupforair wrote: »

Good day folks.

After years of refinancing, misplaced stupidity and blind optimism I've finally taken the step to turn around and face the tsunami that I've been trying to outrun.

I have 7 debts across 5 creditors (totalling 20,000) and having made contact with step change they've suggested a dmp of 250 for 6 years and 9 months.

I've stalled at this step as I'm terrified of the creditors rejecting the offer, I guess I'm reaching out for reassurance that I've got to hold my head up and follow step changes advice.

At the moment I feel a shadow of my former self due to these collective worries spilling over and having an impact on other areas of my life.

I am confident that my situation can and will improve I just need to take this stiff on the chin for now.

Thanks for listening, needed a place to get this all out of my head.

Makes no difference if creditors reject it or not, you still pay it.

All that will happen is your debt may be sold on.

Thats normal practice .

Gill42

Thank you I've paid them all this month as they come at start on the month. So my pack is on its way should I hold off with it until I've opened a new bank and moved my wages etc to that. Gone into default with payments. Can ask how long default 2 months 4?

[Deleted User]

Gill42 wrote: »

Thank you I've paid them all this month as they come at start on the month. So my pack is on its way should I hold off with it until I've opened a new bank and moved my wages etc to that. Gone into default with payments. Can ask how long default 2 months 4?

The whole default situation is like a magical mystery tour:rotfl:. Some creditors default after about 3 months, some after 6, others not at all. I think it's Barclays who are very unwilling to do it but I have no experience of them myself. Most of mine defaulted after 3 payments via Stepchange. Prior to that I was struggling against the odds to never miss a payment. Not good, it was taking a terrible toll on my well-being:o. My slowest to default was Lloyds who took 14 months:eek:


It's possible to get the default date back-dated, posters on here have reported success with that. Others have had no luck at all with it though. I haven't tried it myself yet with Lloyds but plan to before I offer a F&F.


The advantage with defaults is that they disappear from your credit file after 6 years and although some of the debt might still be owing and has to be repaid at least your credit file looks 'clean':j. All but one of my debts will disappear from view in Spring next year so I'm a happy bunny. Not that I want a clean file so I can apply for more credit. Those days are long gone:j. Never again I say.

Gill42

Thank you so should I hold off with the pack and let things go into default.. How long will it take to go into default. I Will open a bank account a d manually move direct debits over. So confused as what to do for the best thank you for you help. I get tax credits does anyone know who long it would take them to move over payment to new bank account can't let it go into old bank.

Suseka97

Gill42 wrote: »

Thank you so should I hold off with the pack and let things go into default.. How long will it take to go into default. I Will open a bank account a d manually move direct debits over. So confused as what to do for the best thank you for you help. I get tax credits does anyone know who long it would take them to move over payment to new bank account can't let it go into old bank.

I think the first part of your question has been answered already - but to clarify, there's no standard in terms of how long a creditor will take to default you. Its differs from company to company and sometimes dependant on an individuals situation too. Some will never default - that's an unfortunate fact.

So - go ahead with opening your basic bank account and switch over your priority payments first (mortgage/rent, council tax, utilities - that sort of thing) and also get in touch with your employer and tax credit people to get your monies paid into as soon as you can. Whilst doing that contact all your non-priority creditors (loans and CCs) - all those that you intend to put into the DMP and tell them you are in discussion with StepChange about setting up a DMP. Give them the SC reference and that'll suffice - none of this will be new to them, trust me on that. Most if not all will put your account on hold for an initial 30day period, that seems to be the norm these days. Do not tell your current bank, especially if you are going to put any sort of overdraft with them on the DMP.

By the time the 30 days are up you should have been able to transfer all priority bills and your salary/tax credit payments too. Then go in and cancel all your direct debits and close your current bank account (which you can only do if you don't have an outstanding overdraft). if you do have an overdraft, still just cancel all DDs and leave the account as it is/open.

When filling in and then returning the SC paperwork - tell them you don't want to start until x month (the x in terms of number of months is up to you). Some posters have left it from anything between 1 - 6 months before starting. SC will want you to start asap, but will accept you need to build up some reserves (emergency funds).

I know this is a long thread (some 190+ pages) but it is worth going back and reading as much as you can. Many of your concerns, worries and questions will have been answered before and it may help you to get a sense of the journey ahead.

Good luck with it.

[Deleted User]

Gill42 wrote: »

Thank you so should I hold off with the pack and let things go into default.. How long will it take to go into default. I Will open a bank account a d manually move direct debits over. So confused as what to do for the best thank you for you help. I get tax credits does anyone know who long it would take them to move over payment to new bank account can't let it go into old bank.

As I said in my previous post there's no knowing when creditors will default. They don't have to do it. You could be waiting for years with some of them:eek:.


Hopefully, someone else with more experience of the pros and cons will be along soon to help you more than I can. I hadn't discovered this thread when I entered my DMP in 2013. The defaults came as real shock and I was terrified as to what they would mean. I needn't have worried though, this thread (once found) put me right:j. Defaults are GOOD in the scheme of things on a DMP.


The reason people advise holding off sending the paperwork back and starting a DMP is for you to stop paying creditors for a while and give yourself a bit of time to build up a bit of an emergency fund of savings. You'll have no access to your credit cards etc on a DMP and will have to rely on the money you actually have. Takes a bit of getting used to at first but I found it strangely liberating when I came to terms with it:j. I know from experience though that emergencies crop up at the most inconvenient times and I had no savings whatsoever to fall back on nor access to credit either. Scary times:eek:

EDIT: whilst typing this post Suseka answered your concerns much better than I could. I've left my ramblings though as they may throw a tiny bit more light on things.