Is a DMP appropriate?

chaplin80

Hi

Is a DMP ever appropriate for someone who is able to meet the minimum payments and actually overpay a little? Even if their debts are very high?

sourcrates

Hi,

You'll need to provide a whole lot more info than that, before anyone can give you a definitive answer.

SOA is your first port of call, don't forget to format for MSE :

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

fatbelly

All we can say from that is 'it can be'

In a dmp interest should be frozen which for large debts can make a big difference.

I once went to a presentation by stepchange (or CCCS as they then were) where they said that something like 10% of their dmps had payments set at or above contractual minimum payment.

chaplin80

I had a webchat with Stepchange yesterday and the said that they wouldn't normally set up a DMP for anyone who is able to manage to contractual payments.

National_Debtline

Hi chaplin80

It is certainly standard advice that a creditor is not going to accept a DMP where someone can afford their debts. The idea of a DMP, or any other debt option, is that the person who owes the money can no longer afford to pay it. Your SOA then backs that up.

If you can afford your monthly repayments but choose not to pay them you need to be aware that it will have an impact on your credit file. It could also make creditors more aggressive in pursuing you if they feel you can afford your debts.

If you can afford your debts you are best to try and overpay the ones that are charging you the most interest first. You may also be able to consider consolidating your debt with a loan at a lower rate of interest than you are currently paying. It’s best to seek some independent financial advice on this before going ahead, but check what fees you may be charged for the advice first.

Susie
@natdebtline