DMP Mutual Support Thread - Part 12

sourcrates

*Sable* wrote: »

No, I haven't. I literally only spoke to SC and did my budget yesterday. My next step is to let the creditors know.

Ah right, ok, yes do that, the normal response will be to freeze your accounts for 30 days, so no need to pay anything.

Cancel all your regular payments.

I wish you good luck with it.

*Sable*

sourcrates wrote: »

Ah right, ok, yes do that, the normal response will be to freeze your accounts for 30 days, so no need to pay anything.

Cancel all your regular payments.

I wish you good luck with it.

Thanks, I'm finding it a bit terrifying but also can't wait to actually have some breathing space each month, and not be waking up at 3am in the days leading up to pay day!

So my standard letter to each creditor should be along the lines of, I'm speaking to SC about my financial difficulties and a DMP, please place the account on hold and freeze interest, will be in touch ASAP with more information? I'm concerned they'll all say "get stuffed" because up to now they've been getting paid on time and in full each month.

On the plus side, I bank with NatWest and my debts are MBNA, Halifax, M&S and Barclaycard, so no need to change my bank account.

Scammie

Hi. I have read these very supportive posts over the last few days but still have some questions. My husband and I have 70k of debt. We have paid everything to date but have accrued credit card debt to do it. I know I am not the only one from reading these posts, but am still ashamed of myself. We have finally realised we cant go on.i have done my SC debt tool and they have said to ring them as there may be different options for myself and husband.
Some CCs and loans are in my name, others are in my husbands, the current account is in joint names and we have an overdraft.
I know your advice here has been to set up a new account and stop direct debits to creditors after writing to them to advise we are starting a DMP with SC. I will do this and gain a few months grace to build up that emergency fund. We are paying 2k a month in loans and CCs !!

However there are a few issues. I need to borrow 5k to pay back my mother. She is recently widowed and I cannot tell her about our finances. She is fragile enough.
I have had a secured loan pre approval from Ocean finance so intend to take this out first before the DMP and my credit history is trashed. Although its already horrendous. I assume I can add this to my budget and SC will take account if it when working out repayments? I would then still pay the secured loan normal payments as normal. Just want to check I can do this?

Also we feel we could pay one of our loans in full as it only has another year to run. Is it possible to continue to pay one creditor the normal
Monthly payment and set up the DMP for the rest, or do they all have to be treated the same?

Another worry is our car. Its hire purchase with three years to run. We want to continue to pay that in full every month?
Finally I have based the SC budget in my husbands basic pay, but the last few months he has had overtime. Payslips from Feb will show his normal pay but March to June will show OT. How does that impact on what SC calculate?

Also as my overdraft and a CC is with Santander as well as one loan. I know the advice is to open a new account. But I am depending on my overdraft just to live. If I close it then the utility bills won!!!8217;t be paid that month. If I keep the account and pay the overdraft fees and loan can I still add the Santander CC to the DMP? Or will they take away my overdraft the minute I do?! I at my wits end

I would be so grateful for any advice. I cant sleep and feel constantly nauseous with the stress and from pretending everything is fine to my m and the kids. Dad died three months and I have to keep going with all this in the background. Am so so worried

sourcrates

*Sable* wrote: »

Thanks, I'm finding it a bit terrifying but also can't wait to actually have some breathing space each month, and not be waking up at 3am in the days leading up to pay day!

So my standard letter to each creditor should be along the lines of, I'm speaking to SC about my financial difficulties and a DMP, please place the account on hold and freeze interest, will be in touch ASAP with more information? I'm concerned they'll all say "get stuffed" because up to now they've been getting paid on time and in full each month.

On the plus side, I bank with NatWest and my debts are MBNA, Halifax, M&S and Barclaycard, so no need to change my bank account.

No they will be fine with you.

Affordability is everything nowadays.

sourcrates

Scammie wrote: »

Hi. I have read these very supportive posts over the last few days but still have some questions. My husband and I have 70k of debt. We have paid everything to date but have accrued credit card debt to do it. I know I am not the only one from reading these posts, but am still ashamed of myself. We have finally realised we cant go on.i have done my SC debt tool and they have said to ring them as there may be different options for myself and husband.
Some CCs and loans are in my name, others are in my husbands, the current account is in joint names and we have an overdraft.
I know your advice here has been to set up a new account and stop direct debits to creditors after writing to them to advise we are starting a DMP with SC. I will do this and gain a few months grace to build up that emergency fund. We are paying 2k a month in loans and CCs !!

However there are a few issues. I need to borrow 5k to pay back my mother. She is recently widowed and I cannot tell her about our finances. She is fragile enough.
I have had a secured loan pre approval from Ocean finance so intend to take this out first before the DMP and my credit history is trashed. Although its already horrendous. I assume I can add this to my budget and SC will take account if it when working out repayments? I would then still pay the secured loan normal payments as normal. Just want to check I can do this?

Also we feel we could pay one of our loans in full as it only has another year to run. Is it possible to continue to pay one creditor the normal
Monthly payment and set up the DMP for the rest, or do they all have to be treated the same?

Another worry is our car. Its hire purchase with three years to run. We want to continue to pay that in full every month?
Finally I have based the SC budget in my husbands basic pay, but the last few months he has had overtime. Payslips from Feb will show his normal pay but March to June will show OT. How does that impact on what SC calculate?

Also as my overdraft and a CC is with Santander as well as one loan. I know the advice is to open a new account. But I am depending on my overdraft just to live. If I close it then the utility bills won!!!8217;t be paid that month. If I keep the account and pay the overdraft fees and loan can I still add the Santander CC to the DMP? Or will they take away my overdraft the minute I do?! I at my wits end

I would be so grateful for any advice. I cant sleep and feel constantly nauseous with the stress and from pretending everything is fine to my m and the kids. Dad died three months and I have to keep going with all this in the background. Am so so worried

Do not take out a secured loan, stop paying your non priority debts and save the 5k, then start your DMP.

Nothing will happen in the time that takes, debt collection takes many months, even years.

Suseka97

Scammie wrote: »

Hi. I have read these very supportive posts over the last few days but still have some questions. My husband and I have 70k of debt. We have paid everything to date but have accrued credit card debt to do it. I know I am not the only one from reading these posts, but am still ashamed of myself. We have finally realised we cant go on.i have done my SC debt tool and they have said to ring them as there may be different options for myself and husband.......

Hi there,

Okay, you are in a similar situation to me when I started on the DMP journey in terms of joint and separate debts (we started at £85k) and having a joint current account etc. etc. I also recall the panic and anxiety I felt at the time, so I do understand what you are feeling right now.

Please do not add to your current dire financial situation by taking out another 'secured' loan to pay back your mother. I'm sure if she did know about your situation she'd be upset knowing you'd got into further debt just to pay her back! Call SC and get the ball rolling on the DMP and they will be able to help you navigate through this.

So - to answer some of your questions.

- You cannot treat creditors differently, no - so all debts, irrespective of when they will be ending should go into the DMP. SC will not allow you to keep one separate from the arrangement.

- It doesn't matter if a few of your payslip include overtime payments, tell SC these are not guaranteed and they won't include them (they didn't with my husbands overtime).

- They might suggest that you consider selling the car if it would clear the hire purchase balance and give you enough to buy another. But I imagine that's probably not the case, so you should be able to continue as you are. We didn't have any HP, so best to check that with them when you call.

- You are going to have to move your current account to one where you have no debts linked to it. As to the current issue re your overdraft and paying bills surely if you stop paying the majority of your non priority debts now, that shouldn't be an issue this month. Contact all creditors bar the ones linked to your bank account and tell them you are in the process of setting up a DMP via SC. They will put your account on hold for 30 days and that'll give you some breathing space and money to pay your essential bills and priority debts. Then get a basic bank account set up elsewhere and move direct debits across manually - all except for the loans and CCs going into your DMP. It'll take a bit of time, but its a necessary step.

- Give yourself 2 - 3 months (or more if you wish) before you start the DMP. Creditors will wait and hopefully default you in the meantime. If, as you say, by not servicing your debts you'll have £2k extra, you'll quickly build up an emergency fund and be able to pay back your mother - without the need to borrow more in order to do so.

Don't overthink this, just do things in the right order and it'll be okay.

*Sable*

Out of interest, how would SC know if you had a certain debt that was close to being paid, and you didn't therefore add it to your budget?

sourcrates

*Sable* wrote: »

Out of interest, how would SC know if you had a certain debt that was close to being paid, and you didn't therefore add it to your budget?

They wouldn't necessarily , but they expect you to treat all creditors fairly, however if one particular debt is near to completion, i see no reason not to pay it off, these are informal arrangements remember, you can pretty much do what you like, as long as you are seen to be fair.

There is no punishment for not treating creditors fairly, you may find stepchange will no longer represent you if you consistently go against there doctrine, but that is all.

Scammie

Suseka97 wrote: »

Hi there,

Okay, you are in a similar situation to me when I started on the DMP journey in terms of joint and separate debts (we started at £85k) and having a joint current account etc. etc. I also recall the panic and anxiety I felt at the time, so I do understand what you are feeling right now.

Please do not add to your current dire financial situation by taking out another 'secured' loan to pay back your mother. I'm sure if she did know about your situation she'd be upset knowing you'd got into further debt just to pay her back! Call SC and get the ball rolling on the DMP and they will be able to help you navigate through this.

So - to answer some of your questions.

- You cannot treat creditors differently, no - so all debts, irrespective of when they will be ending should go into the DMP. SC will not allow you to keep one separate from the arrangement.

- It doesn't matter if a few of your payslip include overtime payments, tell SC these are not guaranteed and they won't include them (they didn't with my husbands overtime).

- They might suggest that you consider selling the car if it would clear the hire purchase balance and give you enough to buy another. But I imagine that's probably not the case, so you should be able to continue as you are. We didn't have any HP, so best to check that with them when you call.

- You are going to have to move your current account to one where you have no debts linked to it. As to the current issue re your overdraft and paying bills surely if you stop paying the majority of your non priority debts now, that shouldn't be an issue this month. Contact all creditors bar the ones linked to your bank account and tell them you are in the process of setting up a DMP via SC. They will put your account on hold for 30 days and that'll give you some breathing space and money to pay your essential bills and priority debts. Then get a basic bank account set up elsewhere and move direct debits across manually - all except for the loans and CCs going into your DMP. It'll take a bit of time, but its a necessary step.

- Give yourself 2 - 3 months (or more if you wish) before you start the DMP. Creditors will wait and hopefully default you in the meantime. If, as you say, by not servicing your debts you'll have £2k extra, you'll quickly build up an emergency fund and be able to pay back your mother - without the need to borrow more in order to do so.

Don't overthink this, just do things in the right order and it'll be okay.

Thanks so much, I really appreciate your advice. I will go ahead and do this. But one more thing to mention. We have 12k credit union loan too. Repayment come from husbands wages. We hoped to pay this off with secured loan but continue to save in credit union before starting the DMP.

This would mean we would have enough saved in three years to meet the final payment in our hire purchase car arrangement. As we will have no credit rating in theee years we would have no car st that point unless we can make that payment. So I hoped to add the Secured loan to the budget. If we could halve our current repayments this is affordable. Could finally live within our means but not worry about losing house or car.

Also Can I just check, when do I cancel direct debits for all CCs and loans? I am worried about the timing of setting up new back account and paying salaries into that account, but direct debits for debts coming out of old account, which I can!!!8217;t close because of the overdraft, and there being no money in that old account. Won!!!8217;t Santander charge me for unpaid debits? Or would this be suspended once I!!!8217;ve written to Santander? Sorry, I prob am overthinking I!!!8217;m just a worrier!

NewbieNat

Well - everything seems to be ticking along nicely, payment went to DMP provider. No phone calls or letters at present The timing of cancelling my current bank account & setting up a basic one, manually moving over DD's & making sure my wages went into the new account - well that was a hugely stressy time but went without a hitch :j I've heard from 6 creditors that they accept my DMP, but nothing from the others, neither have SC heard from them so I'm guessing they are on board. Good luck to everyone starting their DMP journey :grouphug:

Nat