DMP mutual support thread part 13 !!

nbamaster

Hi,

It's me again...

1. Once I've got my DMP in place via Stepchange, will I still be getting letters from my creditors or Stepchange will take care of everything?

TwentyStar

Hi all,

Thanks for the very informative answers on here.

I do have a question though, I have approached SC to start a DMP.

After reading here the norm seems to let all the accounts default FIRST due to interest etc.

I said this to SC and they seemed to disagree with this and claimed that once payments are set up, due to them being lower than the original agreed payment - they will default anyway.

Is this true ? Why are SC so adamant I shouldn’t wait for the accounts to default?

Thanks

SuperFrank88

TwentyStar said:

Hi all,

Thanks for the very informative answers on here.

I do have a question though, I have approached SC to start a DMP.

After reading here the norm seems to let all the accounts default FIRST due to interest etc.

I said this to SC and they seemed to disagree with this and claimed that once payments are set up, due to them being lower than the original agreed payment - they will default anyway.

Is this true ? Why are SC so adamant I shouldn’t wait for the accounts to default?

Thanks

They say this because they are funded by the companies we owe to. Definitely wait for your accounts to default first, while saving an emergency fund. 

Here's a link to see how step change are funded.

https://www.stepchange.org/about-us/how-we-are-funded.aspx

Suseka97

TwentyStar said:

Hi all,

Thanks for the very informative answers on here.

I do have a question though, I have approached SC to start a DMP.

After reading here the norm seems to let all the accounts default FIRST due to interest etc.

I said this to SC and they seemed to disagree with this and claimed that once payments are set up, due to them being lower than the original agreed payment - they will default anyway.

Is this true ? Why are SC so adamant I shouldn’t wait for the accounts to default?

Thanks

Unfortunately SC are not entirely correct and if you read back on numerous posts on this thread, you'll see many examples of creditors who don't default just because you will be paying lower than the contractual amount or minimums.  So, don't. be swayed into jumping on the DMP bandwagon too quickly.  SC are very good at what they do, but as has been said they are funded by the creditors and of course will be keen for you to get something up and running asap.

Suseka97

nbamaster said:

Hi,

It's me again...

1. Once I've got my DMP in place via Stepchange, will I still be getting letters from my creditors or Stepchange will take care of everything?

Yes, you still will for a while until things settle down - then you are likely to get statements from time to time, you may get letters warning about defaults or letters to advise your creditor is selling the debt on to a DCA and then you would get letters from the DCA saying they now own the debt etc.

InDebt2021

Hi All,

Been reading this great thread for hours over the past few nights and it has eased our worries somewhat.

Long story short after a COVID redundancy alongside a new born baby our income earnings were slashed by 50%.

I have been picking up the slack but we are at a point where minimum payments are being met and then the Cc’s are being used to cover day to day expenses. Fuel, food etc.

After sitting on it and sitting on it, we finally sat down and calculated a whopping £56k debt across 8 CC’s,  1 personal loan and one overdraft between us.

Debt that with both incomes was being paid but in reality was planned to be flipped and flipped across 0% cards until being paid off.

In truth weather that was going to work we’ll never know!

This debt is 100% our fault and wanting to be paid off, not written off.

Putting our details through the step change online forms it stated a DMP would be best, to be paid over 17 years.

Hopefully this will reduce as other half gets back into employment, yearly bonuses etc will be put to the DMP to get the length down.

Both relief and shock came over us, followed by another sleepless couple of nights of realisation at what we have actually got ourselves into.

Our mortgage is fixed till 2026 and after reading the forum threads I’m hopeful that new products with the same high street lender will be available to us and just the fact that we won’t be able to change lender would be the issue. Is this right?

Direct debits for minimum payments are due out in the coming weeks and as we have no arrears and good credit scores (we know we’ll be kissing these goodbye)  apart from literally being maxed out credit wise, simply cancelling DD is daunting but the realisation that a DMP is our only option is clear.

Without blabbering on I guess the questions relate to in which order do we proceed and is the below correct?

1. Should we do a joint DMP or individual ones
2. Cancel Direct Debits without saying anything to creditors to build an EF
3. Do you simply ignore letters/ phone calls/ emails from creditors relating to missed payments?
4. How long before letting creditors know we are contemplating a DMP
5. How long of missed payments before writing asking for accounts to be defaulted.
6. Do we literally wait for all accounts to default before entering a DMP.
7. Will creditors not send debt management or bailiffs to us straight away after a couple missed payments?

Apologies for the long and dragged out message but if you could help with the step by step that would be great.

Thank you to everyone who has posted on this thread as each and every individual story has been a great help and I wish you well on being debt free or your journey to being debt free.

For those who may say you got what you deserve and so irresponsible, we want to pay this debt and agree we shouldn't of borrowed so much or buried our heads in the sand. Want to to pay it and move on.

Thanks in advance Charley

sourcrates

Question 7 made me chuckle !!

No one sends anyone, anywhere lol.

Debt management ? think you just made then up, as for bailiffs, there is a long and winding process to be played out before even the possibility of a bailiff becomes a reality.

Q1, depends whose names the debts are in.
Q2, Yes.
Q3, Yes.
Q4, You can write and tell them your in financial difficulty straight away, if you wish.
Q5, This should be played by ear, some default quicker than others, some never do, some do straight away, there are no hard and fast rules here.
Q6, Its best too yes, that way all interest is stopped, there will be no more charges, and the default date is clearly defined.
Q7, Forget all notion of anything like this happening, its a very long way down the line, and as long as you are paying something, at some point, it won`t ever happen.

Ideally you want your perfect credit rating completely trashed, all your debts defaulted, and if they were sold on as well, that would be ideal !!

Debt purchasing companies are much more open to flexible payments, and are easier to deal with.

If your DMP is likely to last that long, then being able to save along the way is very important, as at some point, in the future, it would be nice to have a full and final fund set up, to settle debts as and when discounts are offered, which they will be.

Suseka97

InDebt2021 said:

Our mortgage is fixed till 2026 and after reading the forum threads I’m hopeful that new products with the same high street lender will be available to us and just the fact that we won’t be able to change lender would be the issue. Is this right?

For those who may say you got what you deserve and so irresponsible, we want to pay this debt and agree we shouldn't of borrowed so much or buried our heads in the sand. Want to to pay it and move on.

As Sourcrates has already provided the answers to most of your questions I just wanted to comment on these two points.

You will be able to switch products with your current provider when your fixed term ends, yes.  It's usually done online and takes only a few minutes.  I did this twice during my DMP years and has access to all the standard offers.

I would hope no-one would say such a spiteful thing, but the fact is there are millions of people who are currently struggling with debt and I have a lot of respect for anyone who decides to tackle it head on.  It doesn't matter how you came to where you are today, its about what you do going forward  

InDebt2021

Sourcrates, suskea97 thank you so much for the quick feedback. I’m sure I’ll be back for more!! Thanks again

lisamarie85

It’s been about 6 months since I was last here, I thought everything was going great. I started my DMP in January and all three creditors accepted my token payment of £1 each (£3 per month)

Long story short (a recap for anyone that doesn’t know or remember me) I was waiting for an increase in hours at work, so until I got that increase my parents were paying my bills. 

So my increase in hours came, my parents stopped paying the bills and I contacted PayPlan to see if I should alter what I was paying towards my DMP. 

I told them I didn’t want to rock the boat, as I’d had a few months hassle free- no letters, no phone calls, no chasing. My review didn’t need to be done until January 2022 so I wanted to make sure that by doing it early it wouldn’t cause any issues. 

Fast forward to now, based on their advice I’ve redone my income/expenditure. I upped my payments from £3 per month to £30 and now Barclaycard have rejected my offer- WHY? 😩😭

Anyone any experience or suggestions on what happens now? The other two (Tesco & PRA now, as Halifax passed it on) have accepted. 

I’ve only just seen that Barclaycard have rejected, so now I’m back to that “worrying” feeling until I can speak to Payplan on Monday 🤦‍♀️

This is exactly what I wanted to avoid. I’ve not missed this sinking feeling.