Paying off DMP fully ... advice?

swells_2

Hi everyone. Just a bit of background ... we started a DMP 9 years ago ... at that point it was around the £300k mark and we have currently paid off aprox. £94k of that. We are currently living abroad (where it is much cheaper to live) in our own property (which the DMP company knew about) and we may at last have a buyer for the property... it has been on the market for years. We have lived abroad for 9 years. So we may be in the position to pay off the DMP but I would also like to come back to the UK and buy a property. We would have enough to buy something outright so wont need a mortgage. So my first question is... if the DMP currently stands at £200k~ do you think I would be able to offer a lesser sum to all our creditors to get this debt completely cleared? I have been told by 'people' that creditors will often take less than 50% of the debt to get it cleared. The largest proportion of the debt is to MBNA (£97k) who valued our property the year before everything went bad for us and gave us an extra £60k mortgage and when we 'gave' the house back to them they sold it for a pittance! My husband is 70 and I am 62... he has an OAP and a small £3600 PA private pension. We have no other income now... currently we are paying £400 pm to our creditors. But if the creditors did accept a lesser sum of the debt to clear it would we then still be able to buy a house to live in? Or would they say we want that money as well? We are at a stage in our lives where we want to live near to our children and grandchildren but we wont be able to do that if we get this foreign property sold and then have to use the whole lot to pay off the DMP. Can anyone please give me some advice? Thanks.

Keezing

Hold on, you had a DMP for 300k? Are you sure?

swells_2

Hi there... yes the original DMP was for £300k aprox. It currently stands at just over £200k... and shows that we have paid over £90k.

sourcrates

£300,000 ??? Really ??

Who is your DMP company, please tell me its not one that charges ?

swells_2

Hi there... definitely started at £300k and normal DMP via prominent Debt Charity with no interest. We were lucky enough in the first years of this for my husband to get a job in the Gulf so we could pay £2k per month of the debt for several years hence the £94k paid to date. Since that job ended and we are back in Europe we have been paying just £400k pm. We never wanted to go bankcrupt which I know would probably have been the best thing to do but we felt that although a lot of the debt was interest we had actually had the money so we wanted to pay it back as best we could.

Keezing

if you had a DMP for 300k you got some very, very, very poor financial advice.

The sums here are staggering and you need some proper advice from someone who knows your full situation.

Keezing

swells wrote: »

Hi there... definitely started at £300k and normal DMP via prominent Debt Charity with no interest. We were lucky enough in the first years of this for my husband to get a job in the Gulf so we could pay £2k per month of the debt for several years hence the £94k paid to date. Since that job ended and we are back in Europe we have been paying just £400k pm. We never wanted to go bankcrupt which I know would probably have been the best thing to do but we felt that although a lot of the debt was interest we had actually had the money so we wanted to pay it back as best we could.

So you're currently paying 400k per month?

Do you understand that 'k' means 'thousand'?

swells_2

£400 pm ... sorry.

sourcrates

Well with such high numbers, and you living abroad, lots of variables apply, like if the debts are still with original creditors or have been sold on, are the accounts all enforceable, etc etc.

I would of said bankruptcy would of been the best solution 9 years ago, it's effects would of vanished by now.

There are things you can do now to get settlement deals, but it depends on the full circumstances, a statement of affairs may help us with that :

http://www.stoozing.com/calculator/soa.php

swells_2

Hi again... thank you for hanging in there. The link you sent me is really identical with what I have with Step Change.... I have everything documented with them which gives us the £400pm payment. Our creditors have been very happy over the years and most of the debts have been sold on sometimes twice or three times. A couple of the smaller debts have actually been cleared. The biggest debt £96k is still with NRAM. The creditors were accommodating when we dropped from £2k per month to £400 pm when our circumstances changed. I think they feel that something is better than nothing although with some of the smaller debts I think it must cost more for them to administer than the debt is actually worth. Now our sale is not yet guaranteed but I want to be prepared if it all comes to fruition and sorting out (paying off) these debts is my Number 1 priority. I have had numerous letters from many of the creditors over the years saying they will accept 50% to clear the debt. 50% is probably the interest element before the DMP was started anyway. So... what would be your gut feeling over this... do you think they may accept offers? I am not asking for 100% certainty here just what you think. Thanks.

pbsmiles

swells wrote: »

Hi again... thank you for hanging in there. The link you sent me is really identical with what I have with Step Change.... I have everything documented with them which gives us the £400pm payment. Our creditors have been very happy over the years and most of the debts have been sold on sometimes twice or three times. A couple of the smaller debts have actually been cleared. The biggest debt £96k is still with NRAM. The creditors were accommodating when we dropped from £2k per month to £400 pm when our circumstances changed. I think they feel that something is better than nothing although with some of the smaller debts I think it must cost more for them to administer than the debt is actually worth. Now our sale is not yet guaranteed but I want to be prepared if it all comes to fruition and sorting out (paying off) these debts is my Number 1 priority. I have had numerous letters from many of the creditors over the years saying they will accept 50% to clear the debt. 50% is probably the interest element before the DMP was started anyway. So... what would be your gut feeling over this... do you think they may accept offers? I am not asking for 100% certainty here just what you think. Thanks.

I think they would definately accept offers I am about to offer 30% to pay off 38k of debt after a house sale thats 12k, which me luck.