DMP Mutual Support Thread - Part 12

motivated

I think this is what sourcrates was referring to vaper

sourcrates wrote: »

Hi,

Best practice is to follow these guidelines, so DMP advice, in a nutshell.

You've got to the point where you realize you cannot repay your debts, and a DMP seems like the way forward, so what do you do first ?


(1) cancel/stop all non essential debt repayments.

(2) set up new basic bank account, have your Salary and essential payments re-routed through it.

(3) write to your creditors informing them of your financial situation, tell them you are contacting stepchange, and will be in touch in due course, ask for interest and charges to be stopped, also tell them you prefer contact in writing only.

Your accounts will be put "on hold" for 30 days, to allow you time to get advice, but in reality, you can take as long as you like.

The debt collection process is quite a long, drawn out affair, it can take years before a debt reaches the court stage, if ever.

The key is not to rush into things too quickly, make sure the debt solution you choose, is right for you.

(4) take some time to weigh up your options, save an emergency fund, do a workable budget, (that means one you can stick to) when your ready, contact stepchange (or other FREE provider, never pay for this service) to get the ball rolling.

(5) stepchange will write to your creditors with your offer of payment, most will agree, some may not, that doesn't matter, they will either fall into line, or they will sell the debt on to a 3rd party, it makes no difference to you, you make your payment to SC, they pay whoever owns the account.

(6) You should try to get all your accounts defaulted ASAP, if that means 6 months of no payments, or £1 token payments, then so be it, once defaulted no further interest or charges can be added, and you know that 6 years down the line, the debts will be off your credit file.

The alternative to defaults are "AP" markers, (arrangement to pay) they stay on your file 6 years from when you pay off the debt, so potentially a very long time.

(7) that's it, from then on it should all run smoothly, there may be the odd bump in the road, but basically you shouldn't have any more creditor pressures.

Most DMP's run like clockwork, yours will too.

Sazzie23

vaper wrote: »

does anyone know how long stepchange usually set up their DMP's for, or is it just dependent on your earnings and the total amount owed?
I'm still rattling around with my calculator and trying to make things all add up.
Also, when do you actually miss that first payment? and how do you build up an emergency fund from nothing? Sorry for all the questions but I feel out of my depth and want to have a better understanding.

Bank account is approved and we're just waiting for cards and PIN to come through then first job will be to have wages changed to the new accounts. Then what?

Hi vaper

In addition to the great advice already posted, try to change your mindset from 'what's acceptable' to 'what's affordable', it'll help you stay sane instead of trying to make your circumstances fit in, make the DMP fit your circumstances.

Saz

Twins

sourcrates wrote: »

You simply remove it from your DMP.

That's all you need to do, or offer them 10p.

Without a valid credit agreement the debt is unenforceable in court, therefore the creditor cannot obtain judgement against you.

Personally I would look on this as a "get out of jail free card" others may feel differently, but I would walk away with a Hugh smile on my face.

Morning Sourcrates. Sorry for all the questions but just to be sure would I reduce the balance to zero on my online SC payment so effectively they don't send anymore payments to them? Then I'll write to them to say the debt is unenforceable and offer F&F? Would they contact SC about the zero balance do you think? Thanks again for the help!

sourcrates

Twins wrote: »

Morning Sourcrates. Sorry for all the questions but just to be sure would I reduce the balance to zero on my online SC payment so effectively they don't send anymore payments to them? Then I'll write to them to say the debt is unenforceable and offer F&F? Would they contact SC about the zero balance do you think? Thanks again for the help!

Yes, just do that.

If you want to offer them money, that's up to you, personally I wouldn't.

I doubt they will contact SC, why would they ?

January has done this with some of her debts, if she picks this up, I'm sure she will detail it for you.

January2015

Hi Twins

Sourcrates is right. You don't have to pay them a thing. However, if you want this done and dusted on your credit report then you can make a low offer (no more than 10% of the outstanding balance) to settle this account and mark your credit reference agency (CRA) files accordingly. I have done this with our unenforceable account merely because we wanted to draw a line under the account and it be cleared of the CRA files.

I've sent you a PM

Weakmoments

Hi I have 2 debts with PRA and they have advised that they are both unenforceable. Due to this I offered !!!!!! on the first for 10% and have received their response today. Stating they are unable to accept my offer but would accept 90% on both. ��Any advice please????

January2015

Weakmoments wrote: »

Hi I have 2 debts with PRA and they have advised that they are both unenforceable. Due to this I offered !!!!!! on the first for 10% and have received their response today. Stating they are unable to accept my offer but would accept 90% on both. ��Any advice please????

Write back and advise that whilst the debts are unenforceable you will not be making any payments, however you repeat your offer to settle the debts for 10% of the outstanding balance - be clear that you are not prepared to increase your offer.

They are playing games. They know they cannot make you pay whilst they cannot provide enforceable documentation and are pushing their luck to try and get 90% out of you.

If they come back and say no to the 10% offer - then just do not pay them any more money at all and do not enter into any further correspondence. We ignored all communication from them for a year. They settled at 10% eventually.

Weakmoments

Thanks January will I have to self manage my DMP if I do this ?

January2015

Weakmoments wrote: »

Thanks January will I have to self manage my DMP if I do this ?

Not necessarily - I've sent you a PM :beer:

Suseka97

Okay - recent topics around unenforceable debts have peaked my interest. So out of interest, what is making certain debts unenforceable? Is it the age of the debt or the fact that DCAs hold no paperwork setting out the T&Cs at the point the contract between the original creditor and lender took place or a mix of both?

Good to hear some folks are in the position of settling those debts well below the amount outstanding with F&Fs or being able to ignore entirely.