DMP mutual support thread part 13 !!

nicwantstobuy

Hols2021 said:

nicwantstobuy said:

Hi if in a dmp does it show as missed payments on credit file? Im wondering if not paying my loan for 3 months will be off my file quicker than a dmp if that makes sense? I know my budget is on a knife edge getting rid of the 2 smaller debts would make a difference

The missed payments will stay on your file for 6 years also. The DMP will show up I believe as defaults and with the DCA who are dealing with the debt, that’s how our files look now. Obviously a missed payment isn’t as serious as a default, maybe you could speak to your loan provider and ask them to give you breathing space if you think that’ll help you to get on our feet a bit. We are like April above, it’s been a huge relief for us to enter into the DMP but we had a lot more debt than you and were drowning. Everyone on here esp Sourcrates has been super helpful and the DCA have also been great with us too. I hope it all works out for you. 

Thank you, it’s really good to hear how it has helped you 

April22

nicwantstobuy said:

April22 said:

Hi Everyone
I haven’t posted in a while - but actually that’s a good thing - it means I haven’t been thinking about debt! 
I wanted to give you all an update on my journey to reassure anyone (who like I did) is feeling apprehensive about DMP’s.
I started last April with 104k worth of debt. Today I’m at 94k - I’m really happy with how quickly it’s going down. I had 5 credit cards and 2 loans - the credit cards have all now defaulted, and the 2 loans haven’t, but I’m hoping they will soon. 

I went through Stepchange. And the one easy payment has been a godsend for me. There was a month where I had an unexpected house expense and they just took a minimal amount that month. 

People always say this - and I never believed them - but this was the best decision I ever made. The DMP process is brilliant. 

Debt collection companies have all been very friendly and kind - and I don’t get any letters at all…. But one thing I did was communicate with my creditors when I was setting up with Stepchange. I kept them informed and so I never received calls and letters to be honest - only the standard legal letters they have to send - but nothing more.

I hope this post brings comfort to someone else.

April x 

Thank you that really does bring me comfort, thank you so much for posting x

No problem. I’m a homeowner, my mortgage is entirely unaffected. After just 10 months I’ve already started receiving settlement offers (not in a position to do this yet but it’s a nice feeling) 

I grappled with a DMP for a year before doing it and it was a year wasted! But I was frightened because I generally find people post a lot of horror stories (not this forum - just in general) so I wanted to give reassurance that if you stick to what you agree, bailiffs, CCJ’s etc are all a myth. I actually think those things are more likely if you don’t take a DMP.

April x

sourcrates

nicwantstobuy said:

Hi if in a dmp does it show as missed payments on credit file? Im wondering if not paying my loan for 3 months will be off my file quicker than a dmp if that makes sense? I know my budget is on a knife edge getting rid of the 2 smaller debts would make a difference

Nic,

If not paying your loan for a while, helps you to budget better, and lets you avoid going into debt management, then you should do that.

Yes missed payments will be recorded, but to be honest, your credit file will heal with time, that should not be your top priority right now, getting on a better footing with your finances is what is important.

The debt collection process takes a very long time to kick into gear, so nothings going to happen here, concentrate on getting rid of the smaller debts, then take stock of your situation.

Bonfire_Bride

nicwantstobuy said:

Hi if in a dmp does it show as missed payments on credit file? Im wondering if not paying my loan for 3 months will be off my file quicker than a dmp if that makes sense? I know my budget is on a knife edge getting rid of the 2 smaller debts would make a difference

How are you doing for rent, council tax and heating/eating? 

dfwb23

Hi everyone. I have to say, finding this forum and this thread, in particular, has been amazing. Reading through people that have had similar situations and have found light at the of the debt tunnel has really made me feel more positive about my own situation. I have recently started a new career which whilst it has significantly better long-term earning potential, I have taken a significant drop in wages in the interim. Couple that with the recent cost of living issues, and things have been a struggle as of late.

My situation is, 16k unsecured debt, split between loans, credit cards, and overdrafts. Fortunately, not behind in rent, council tax, and energy bills are in credit at the moment so doing well on that front. I am now at the stage though when debt repayments are essentially swallowing up everything I have left after paying basic household bills, barely leaving me anything with which to fuel up the car and buy food. I'm living off more and more credit just to get buy, paying off credit with other credit and the credit pool is drying up. I'm basically one random little life event away from being in serious, serious trouble. 

I believe a DMP is probably the way to go for me. I would rather go self-managed, I have a few questions and queries about how I should precede and why some people advise or do certain things. 


First off, Emergency Funds. I'm 32, I have zero savings, and anytime life throws a financial clanger at me, it's super stressful and I struggle to deal with it. I would also like to one day own my house so being able to start saving is a huge goal of mine. But short term, having an emergency fund is extremely important for me. I see a lot of people saying when you stop paying your creditors, you should use this opportunity to start saving an EF. Is this because it's the best opportunity you will have to start one, or are there some unexpected costs associated with a DMP you have to be prepared for? Perhaps a little of column A and a little from column B I suspect, but would be good to be prepared regardless. 

Also, I have a few small credit amounts (<£300), would I better clearing them during this time or just add them to the DMP and put the money into an EF. 


With regards to negotiating repayment plans with creditors, how accommodating do they tend to be? I'm sure it differs on a case-by-case basis but just in general, do they tend to be quite willing to negotiate? Since all the defaults are going to be on my credit file and I will have defaults recorded there until 6 years after the last default date, my ideal plan would just be to repay all my debts across the 6 years from the date of the last default. Is anyone able to give some insight into how accommodating creditors are likely to be to repayments over this time scale? I'm not trying to get the debt reduced or anything, I want to pay it all back but just within a timeframe that I can actually afford. 

Since the time taken for an account to default varies hugely, is it worth paying any account that defaults a token payment until the time comes when all my accounts have defaulted to avoid legal action? 

With regards to negotiating with creditors, am I correct in thinking that I don't need to do a formal DMP or anything like that, I can literally just offer them payment terms and hope they accept?


I'm not sure how realistic all this is, but I've calculated that freezing interest and charges and repaying all my debts over 6 years would basically reduce my monthly debt repayments to £230 a month which is pretty much a quarter of what I'm paying now. This would relieve my financial stresses and anxieties hugely and would even leave me with enough to start saving for a deposit for a mortgage each month as well. I'm just not sure about the morals on that one, technically, that money could be going towards my creditors which is money I do owe so I'm pretty conflicted on whether or not it's the right thing to do. 

Anyway, any and all advice, criticism, feedback, and suggestions would be really appreciated. 

Palpitations

Hi I’ve got myself in a muddle with a debt with creation and they have shoosmiths now equivo solicitors dealing with it. Looks like they obtained a ccj last year and they are now threatening further legal action if I don’t increase payment. What is the likelihood of them accepting a reduced offer at this stage? Thanks 

nicwantstobuy

Thanks for all the advice & support so far. I decided to go Dmp with step change. MASSIVE decision for me, I’ve had to really shift my thinking about where to prioritise money - rent, gas & elec, loan, were priority over everything else inc food. The poor advisor at step change, I cried so much when we talked through my budget, I’d been massively reducing our food budget, buying enough for my little boy, cutting back on mine to two decent meals a week & everything else either on toast or my work lunches of coffee & a dairy Lea dunker. The advisor was great, really supportive & patient. 

I think I’ve started to accept that dmp will be best but I’m still a bit scared as my first ever missed payment will be next week. Hopefully when the sky doesn’t fall in then I might feel some relief. It does feel good to know I will have money for food next month, as well as all the bills. 

To the poster above asking re savings, I would also love to buy. I was advised that I can save a max of £25 per month -(this also feels like a luxury) I guess it depends on whether creditors want to see your budget?  I’ve no experience of this, my budget was planned with step change who I think share it with my creditors. If you can afford to save could you repay your debts quicker then save? I’m hoping that once I have more realistic actual costs of living that I can increase my payments.  Sorry I don’t have answers but I’m sure someone else will know for sure. Good luck 

Grazia41

nicwantstobuy said:

Thanks for all the advice & support so far. I decided to go Dmp with step change. MASSIVE decision for me, I’ve had to really shift my thinking about where to prioritise money - rent, gas & elec, loan, were priority over everything else inc food. The poor advisor at step change, I cried so much when we talked through my budget, I’d been massively reducing our food budget, buying enough for my little boy, cutting back on mine to two decent meals a week & everything else either on toast or my work lunches of coffee & a dairy Lea dunker. The advisor was great, really supportive & patient. 

I think I’ve started to accept that dmp will be best but I’m still a bit scared as my first ever missed payment will be next week. Hopefully when the sky doesn’t fall in then I might feel some relief. It does feel good to know I will have money for food next month, as well as all the bills. 

To the poster above asking re savings, I would also love to buy. I was advised that I can save a max of £25 per month -(this also feels like a luxury) I guess it depends on whether creditors want to see your budget?  I’ve no experience of this, my budget was planned with step change who I think share it with my creditors. If you can afford to save could you repay your debts quicker than save? I’m hoping that once I have more realistic actual costs of living that I can increase my payments.  Sorry I don’t have answers but I’m sure someone else will know for sure. Good luck 

I'm in a similar situation to you too - I sorted out my DMP (with Payplan as I'm self employed) yesterday. I haven't even missed any payments yet. I'm struggling with the idea of ignoring creditor letters/ calls when or if they come. Because that's what I've been avoiding but like yourself I have had no money left to 'live'. 

I know something had to change but I am truly gutted about my credit file to be honest. I've fought so hard to avoid this as 6 years is such a long time. But ultimately I have no choice left now.

I also have a husband who has a perfect credit score and is really good with money so I am dealing with this alone and feel like a failure. I'm dreading the time coming when he suggests us moving or a change of car for me etc as I feel like then my 'secret' will come out

I just keep trying to remember that I sadly have no choice now though.

19ryanh93

Hi all. 

So I’ve been on my DMP for a while and thought I’d check my credit report because why not haha. 

One thing I have noticed is that all the creditors are marking my payments as defaulted. Is that normal? 

ditty1234

Grazia41 said:

nicwantstobuy said:

Thanks for all the advice & support so far. I decided to go Dmp with step change. MASSIVE decision for me, I’ve had to really shift my thinking about where to prioritise money - rent, gas & elec, loan, were priority over everything else inc food. The poor advisor at step change, I cried so much when we talked through my budget, I’d been massively reducing our food budget, buying enough for my little boy, cutting back on mine to two decent meals a week & everything else either on toast or my work lunches of coffee & a dairy Lea dunker. The advisor was great, really supportive & patient. 

I think I’ve started to accept that dmp will be best but I’m still a bit scared as my first ever missed payment will be next week. Hopefully when the sky doesn’t fall in then I might feel some relief. It does feel good to know I will have money for food next month, as well as all the bills. 

To the poster above asking re savings, I would also love to buy. I was advised that I can save a max of £25 per month -(this also feels like a luxury) I guess it depends on whether creditors want to see your budget?  I’ve no experience of this, my budget was planned with step change who I think share it with my creditors. If you can afford to save could you repay your debts quicker than save? I’m hoping that once I have more realistic actual costs of living that I can increase my payments.  Sorry I don’t have answers but I’m sure someone else will know for sure. Good luck 

I'm in a similar situation to you too - I sorted out my DMP (with Payplan as I'm self employed) yesterday. I haven't even missed any payments yet. I'm struggling with the idea of ignoring creditor letters/ calls when or if they come. Because that's what I've been avoiding but like yourself I have had no money left to 'live'. 

I know something had to change but I am truly gutted about my credit file to be honest. I've fought so hard to avoid this as 6 years is such a long time. But ultimately I have no choice left now.

I also have a husband who has a perfect credit score and is really good with money so I am dealing with this alone and feel like a failure. I'm dreading the time coming when he suggests us moving or a change of car for me etc as I feel like then my 'secret' will come out

I just keep trying to remember that I sadly have no choice now though.

'I also have a husband who has a perfect credit score and is really good with money so' how do you know? Do you two tally all expenses up and share them? Including all of the little kiddy expenses, gifts and house items - if you have children that really adds up? Remember to start saving up, and do a pension check if you're self employed. And be proud that you're getting your finances together, not embarrassed.