DMP mutual support thread part 13 !!

moomoo73

I have a DMP with Stepchange, which currently looks like this:

Link Financial - £7186

Westcot - £6,250

Westcot - £4, 177

PRA Group - £3,930

Westcot - £2,700

Westcot - £2, 376

At the moment I pay £200 ish to Stepchange each month, meaning I'm not expected to be debt free until 2030. 

I have built up some savings during lockdown which is making me think about the possibility of a Final Settlement Offer to take out some of this debt, but there's a few things I'm not clear on...

- Is this something I can do if I only have enough to make an offer on one or two of the debts and not all of them?

- The smallest debts are with Westcot, but I can't make an offer on all of them - I only want to make an offer on one I could theoretically pay outright to give me some flexibility. Would it be worth trying to make an offer on just one and go from there? 

- Would this affect my DMP if I did this?

- Would I be better off carrying on as I am now and just putting away any spare money each month, at least until I'm in a position to clear all of the debts in some way?

The defaults should, I think,  fall off my credit file in two or three years, which makes me want to start work on getting rid of these debts as much as I can - we rent privately and I am worried about credit checks if we move. Plus, I just want to move on and be less of an idiot with money

sourcrates

moomoo73 said:

I have a DMP with Stepchange, which currently looks like this:

Link Financial - £7186

Westcot - £6,250

Westcot - £4, 177

PRA Group - £3,930

Westcot - £2,700

Westcot - £2, 376

At the moment I pay £200 ish to Stepchange each month, meaning I'm not expected to be debt free until 2030. 

I have built up some savings during lockdown which is making me think about the possibility of a Final Settlement Offer to take out some of this debt, but there's a few things I'm not clear on...

- Is this something I can do if I only have enough to make an offer on one or two of the debts and not all of them?

- The smallest debts are with Westcot, but I can't make an offer on all of them - I only want to make an offer on one I could theoretically pay outright to give me some flexibility. Would it be worth trying to make an offer on just one and go from there? 

- Would this affect my DMP if I did this?

- Would I be better off carrying on as I am now and just putting away any spare money each month, at least until I'm in a position to clear all of the debts in some way?

The defaults should, I think,  fall off my credit file in two or three years, which makes me want to start work on getting rid of these debts as much as I can - we rent privately and I am worried about credit checks if we move. Plus, I just want to move on and be less of an idiot with money

Unfortunatly stepchange work on the theory that you should treat all your creditors fairly, however, if you take it upon yourself to settle a particular debt early, you would just ask SC to remove that creditor from your plan, if they ask, your great aunt mabel paid it off for you, you get where i`m coming from ?

bluebell_on_track

I have taken the first steps of setting up a DMP with step change. I’ve scoured this forum but still so much to take in. I have 8 debts ranging from several loans to credit cards totalling around £50,000, which is absolutely horrendous. I feel genuinely ashamed that I have got myself into this situation. Step change have suggested I pay around £400 to them a month which calculates my debt would be cleared within around 13 years. I know all of my debts will be enforceable as they are all fairly recent (last 8 years or so). 

I just wondered if I wanted to start paying off the debts a bit quicker if I ever had a bonus (which I’m not expecting necessary and couldn’t afford to pay any off now), would I go through step change for this or would I approach a lender directly to get a settlement? Has anyone had experience with Very? I am expecting them to be difficult to deal with. Thanks for your help. I’m so embarrassed and shamed of this whole situation. Thanks in advance. 

Suseka97

bluebell_on_track said:

I have taken the first steps of setting up a DMP with step change. I’ve scoured this forum but still so much to take in. I have 8 debts ranging from several loans to credit cards totalling around £50,000, which is absolutely horrendous. I feel genuinely ashamed that I have got myself into this situation. Step change have suggested I pay around £400 to them a month which calculates my debt would be cleared within around 13 years. I know all of my debts will be enforceable as they are all fairly recent (last 8 years or so). 

I just wondered if I wanted to start paying off the debts a bit quicker if I ever had a bonus (which I’m not expecting necessary and couldn’t afford to pay any off now), would I go through step change for this or would I approach a lender directly to get a settlement? Has anyone had experience with Very? I am expecting them to be difficult to deal with. Thanks for your help. I’m so embarrassed and shamed of this whole situation. Thanks in advance. 

Okay, firstly - there's no shame here, so just put that to bed and stop beating yourself up about it  We've all been there and more will follow (sadly).

If it were me, seeing as you are just starting out, I would set aside any extra income you make and put it where you'll not be tempted to spend it.   I personally wouldn't go via SC for offers, albeit that's be further down the line for you; they prefer to treat all creditors the same so wouldn't be agreeable to you paying off individual lenders.  But you are just starting out, so for now I'd just let the DMP settle into its rhythm and give yourself some headspace over the festive season.

With that said, I hope you are not jumping too quickly into the DMP.  It's certainly tempting, but the advice given by those of us who have been in a long term DMP is to leave it a minimum of 3 months of non-payment (preferably up to 6 months) before starting the DMP.  That allows you to save up a decent emergency fund but more importantly it helps to push your creditors into defaulting the account/s, which is what you should be looking for.  Once an account is defaulted, all interest and charges stop and the 6 year clock starts ticking.  

As for Very, I think you are right that they can be tricky and tend to hold out against defaulting the account.  Of course things may have changed, but be aware of that and be prepared for a bit of a battle with them.

bluebell_on_track

Suseka97 said:

bluebell_on_track said:

I have taken the first steps of setting up a DMP with step change. I’ve scoured this forum but still so much to take in. I have 8 debts ranging from several loans to credit cards totalling around £50,000, which is absolutely horrendous. I feel genuinely ashamed that I have got myself into this situation. Step change have suggested I pay around £400 to them a month which calculates my debt would be cleared within around 13 years. I know all of my debts will be enforceable as they are all fairly recent (last 8 years or so). 

I just wondered if I wanted to start paying off the debts a bit quicker if I ever had a bonus (which I’m not expecting necessary and couldn’t afford to pay any off now), would I go through step change for this or would I approach a lender directly to get a settlement? Has anyone had experience with Very? I am expecting them to be difficult to deal with. Thanks for your help. I’m so embarrassed and shamed of this whole situation. Thanks in advance. 

Okay, firstly - there's no shame here, so just put that to bed and stop beating yourself up about it  We've all been there and more will follow (sadly).

If it were me, seeing as you are just starting out, I would set aside any extra income you make and put it where you'll not be tempted to spend it.   I personally wouldn't go via SC for offers, albeit that's be further down the line for you; they prefer to treat all creditors the same so wouldn't be agreeable to you paying off individual lenders.  But you are just starting out, so for now I'd just let the DMP settle into its rhythm and give yourself some headspace over the festive season.

With that said, I hope you are not jumping too quickly into the DMP.  It's certainly tempting, but the advice given by those of us who have been in a long term DMP is to leave it a minimum of 3 months of non-payment (preferably up to 6 months) before starting the DMP.  That allows you to save up a decent emergency fund but more importantly it helps to push your creditors into defaulting the account/s, which is what you should be looking for.  Once an account is defaulted, all interest and charges stop and the 6 year clock starts ticking.  

As for Very, I think you are right that they can be tricky and tend to hold out against defaulting the account.  Of course things may have changed, but be aware of that and be prepared for a bit of a battle with them.

Thanks for your reply. Yes definitely I just need to man up and get on with it. I hadn’t understood the default situation fully I don’t think and I have gone for step change too quickly. I have already informs my creditors that I am entering a payment plan with step change so not sure how I would undo this now to get the accounts defaulted. 
I have sent my payslips etc to step change but not officially entered DMP yet. 

Suseka97

bluebell_on_track said:

Suseka97 said:

bluebell_on_track said:

I have taken the first steps of setting up a DMP with step change. I’ve scoured this forum but still so much to take in. I have 8 debts ranging from several loans to credit cards totalling around £50,000, which is absolutely horrendous. I feel genuinely ashamed that I have got myself into this situation. Step change have suggested I pay around £400 to them a month which calculates my debt would be cleared within around 13 years. I know all of my debts will be enforceable as they are all fairly recent (last 8 years or so). 

I just wondered if I wanted to start paying off the debts a bit quicker if I ever had a bonus (which I’m not expecting necessary and couldn’t afford to pay any off now), would I go through step change for this or would I approach a lender directly to get a settlement? Has anyone had experience with Very? I am expecting them to be difficult to deal with. Thanks for your help. I’m so embarrassed and shamed of this whole situation. Thanks in advance. 

Okay, firstly - there's no shame here, so just put that to bed and stop beating yourself up about it  We've all been there and more will follow (sadly).

If it were me, seeing as you are just starting out, I would set aside any extra income you make and put it where you'll not be tempted to spend it.   I personally wouldn't go via SC for offers, albeit that's be further down the line for you; they prefer to treat all creditors the same so wouldn't be agreeable to you paying off individual lenders.  But you are just starting out, so for now I'd just let the DMP settle into its rhythm and give yourself some headspace over the festive season.

With that said, I hope you are not jumping too quickly into the DMP.  It's certainly tempting, but the advice given by those of us who have been in a long term DMP is to leave it a minimum of 3 months of non-payment (preferably up to 6 months) before starting the DMP.  That allows you to save up a decent emergency fund but more importantly it helps to push your creditors into defaulting the account/s, which is what you should be looking for.  Once an account is defaulted, all interest and charges stop and the 6 year clock starts ticking.  

As for Very, I think you are right that they can be tricky and tend to hold out against defaulting the account.  Of course things may have changed, but be aware of that and be prepared for a bit of a battle with them.

Thanks for your reply. Yes definitely I just need to man up and get on with it. I hadn’t understood the default situation fully I don’t think and I have gone for step change too quickly. I have already informs my creditors that I am entering a payment plan with step change so not sure how I would undo this now to get the accounts defaulted. 
I have sent my payslips etc to step change but not officially entered DMP yet. 

You can still delay the start, just because you've told them you are entering a plan via SC - doesn't mean you've tied yourself into a start date.  I would let SC know that you want to hold off for a few months whilst you get yourself on a better footing and just say you'll be back in touch when you are ready to start.  They are quite used to people doing this, so it'll be fine.  When people approach SC they usually do so because they have hit that wall and are desperate to get something in place; SC are great - but they will want you to get up and running as soon as (which is understandable) and although when they contact your creditors they ask them nicely to consider stopping all interest and charges - it's not often that effective.  Not paying a creditor tends to be the quickest route to get the default, which has the benefit of all interest and charges stopping.

When I set up mine (completely oblivious to this forum) I jumped straight in and it took over a year before some creditors applied a default and some took a lot longer than that - so I had to start complaining about it and eventually was able to get some of them to backdate the default to within 6 months of the start of the DMP.   Had I been a bit more savvy about these things I would have held off and used the money I was paying towards my (then) debts, to build up a nice EF.

You live and learn - and so the advice you'll hear from many on this thread is to take your time and make sure that whatever you agree to, in terms of payments - it's both affordable and sustainable.  It's not a race  

sourcrates

Delaying the start, by non, or token payment, will encourage the creditor to default the account, they will also look to sell it on.

Before this happens accounts can be passed to debt collectors to try to collect first, this is of no help to you and just delays things further.

Your best bet is to ignore things for a good while, obviously taking note of any letters that are sent, most will be standard collection letters, ideally you want your accounts all defaulted, and all sold on, that way no further interest will be added, no further charges will be added, and you have a clear 6 year timeframe for when the debts drop off your credit file.

That is the ideal time to make a payment arrangement, the original creditors will have lost interest and sold the debts on, the new owners will be more than happy to agree favourable terms, and further down the line, settlements will become available, the perfect route to debt management.

bluebell_on_track

This is amazing. Thanks for much both of you. I will definitely do this now. I think I was trying to do the ‘right’ thing but not necessarily the best thing. Thanks again! 

Changingtimes

Hi all, just thought I would pop on.  £22K debt in January 2019 now down to just under £2000 in November 2020.  I stuck with it and have never felt more positive and happier.  Stick with it all you guys!!  Question.  I have 1 account (not defaulted so I am informed by the creditor but credit report does show Delinquent with X missed payment markers on it) I only owe them £97 now, they offered me £50 to settle it off (so a £47 discount).  Question is as the account is not default does it really matter the debt is partially settled or not bearing in mind i have the X markers all over it and default from other lenders?   Start date for loan is October 18. They have not applied any extra interest since paying via a DMP. Should i be pushing for a default here?  If i close off in the next couple of months i am presuming it will drop off 6 years from last payment?  Any advice would be appreciated

ditty1234

I have now had a letter from Wescot stating thet they know where I live! They are acting on behalf of Natwest, and the balance is unenforceable. I have written Wescot and I think the letters have crossed, so I'm not too concerned but should I be writing Natwest as well? Also I get a phonecall from Wescot everyday, and in my latest and previous letters I have requested to only communicate by post. My decision for now is to not reply to the letter. My first payment to an enforceable debt is in December, I am happy to finally start payments again, after a long tussle of various sorts. But from almost 24.000 I am left with just over 10.000 that I will be trying to pay off, but quite slowly as am still building up my EF. Seems like self managed DMP is coming together after all.