DMP mutual support thread part 13 !!

Floss

wildheart83 said:

Thanks aquafish_2 - it's so reassuring to hear that you can go self managed without too much hassle. I think we are so accustomed to being told here are the rules, this is what you need to do etc.

I phoned SC to give them details of a debt I'd forgotten about and the first question was "why did you take out more credit when you knew you couldn't afford it?" that kind of attitude sets my teeth on edge!

And that's why folk go self managed - we're all adults, we know we made dubious financial decisions in the past but we're now addressing them & don't need to be treated like naughty children!

I now have 6/6 defaults, at least one debt sold and I last made "normal" payments in August. I set up everything based on the NEDCAB resources but my income has since dropped due to cancer surgery so they're all getting £1 a month.

wildheart83

Floss said:

wildheart83 said:

Thanks aquafish_2 - it's so reassuring to hear that you can go self managed without too much hassle. I think we are so accustomed to being told here are the rules, this is what you need to do etc.

I phoned SC to give them details of a debt I'd forgotten about and the first question was "why did you take out more credit when you knew you couldn't afford it?" that kind of attitude sets my teeth on edge!

And that's why folk go self managed - we're all adults, we know we made dubious financial decisions in the past but we're now addressing them & don't need to be treated like naughty children!

I now have 6/6 defaults, at least one debt sold and I last made "normal" payments in August. I set up everything based on the NEDCAB resources but my income has since dropped due to cancer surgery so they're all getting £1 a month.

Wishing you all the very best after your surgery Floss, I hope you're feeling well.

Exactly, it was a creditor I'd really hoped to have paid off but alas wasn't to be. Some advisors I spoke to were excellent, others, not so much. 

wildheart83

So, like everyone else, my expenses have gone up when my income has stayed the same. One creditor refuses to default me, or sell my account on, and some other reasons thrown into the mix means I've decided to go self managed.
 
If I were to stay with the budget set by SC, and by only paying the naughty creditor £1 a month it leaves me with £194 to reallocate. This would pay off my smallest debt in one payment and allow me to start building up an EF which has been wiped out over the past year. 

It also would mean my DMP is finished in just over 3 years, but it won't make a difference to my credit file as the defaults won't drop off for another 2 years after that - 4 years of DMP then the extra 2 years post completion. Is there any benefit to me busting a gut to pay it off in 4 years rather than paying it off over 5/6 years? 

If I send the letters to SC and my creditors, my next payment is due to leave on the 1st June. I'm guessing I still need to pay the SC direct debit, or a manual payment to each creditor if it's not all agreed by then? 

sourcrates

wildheart83 said:

So, like everyone else, my expenses have gone up when my income has stayed the same. One creditor refuses to default me, or sell my account on, and some other reasons thrown into the mix means I've decided to go self managed.
 
If I were to stay with the budget set by SC, and by only paying the naughty creditor £1 a month it leaves me with £194 to reallocate. This would pay off my smallest debt in one payment and allow me to start building up an EF which has been wiped out over the past year. 

It also would mean my DMP is finished in just over 3 years, but it won't make a difference to my credit file as the defaults won't drop off for another 2 years after that - 4 years of DMP then the extra 2 years post completion. Is there any benefit to me busting a gut to pay it off in 4 years rather than paying it off over 5/6 years? 

If I send the letters to SC and my creditors, my next payment is due to leave on the 1st June. I'm guessing I still need to pay the SC direct debit, or a manual payment to each creditor if it's not all agreed by then? 

Well, no, not really, you are only contracted to monthly payments by a credit agreement, your not under any obligation to make monthly payments every month on any old delinquent debt.

Monthly payments only apply to credit agreements, defaulted debts you can pay as and when you choose.

Makingabobor2

I agree with all the advice re going self managed. Best thing we ever did. After me being made redundant twice and then giving up work 3 years ago, we have been plodding along paying the bare minimum, but now we know that from this summer we will be in a position to start paying a lot quicker and have already had so many F&F settlement offers from creditors. So while it might all look scary at the start, it really isn't. 

CharlieD2k

Hi all new to this. Can someone please explain to me how a DMP works, how do they work out how much you should pay them to pay to creditors each month?

For example if I paid £1000 per month to non-prioiriy creditors but that left me in a negative balance each month after living expenses and priority payments would me DMP amount be less than what I was paying without the DMP? I just don't get the working out and I like to understand things fully.

swansea_lad

Hi everyone. I have paid off my DMP in full in February  anyone recently paid their DMP off too? Did you notice your credit rating has improved? 

Floss

CharlieD2k said:

Hi all new to this. Can someone please explain to me how a DMP works, how do they work out how much you should pay them to pay to creditors each month?

For example if I paid £1000 per month to non-prioiriy creditors but that left me in a negative balance each month after living expenses and priority payments would me DMP amount be less than what I was paying without the DMP? I just don't get the working out and I like to understand things fully.

You work out your budget to pay your priority bills, fuel, travel & food expenses first, then what is left from your income is what can be paid to your creditors.

Also, can I ask who is the "they", who's your DMP with?

CharlieD2k

StepChange 

sourcrates

CharlieD2k said:

Hi all new to this. Can someone please explain to me how a DMP works, how do they work out how much you should pay them to pay to creditors each month?

For example if I paid £1000 per month to non-prioiriy creditors but that left me in a negative balance each month after living expenses and priority payments would me DMP amount be less than what I was paying without the DMP? I just don't get the working out and I like to understand things fully.

A DMP is an informal arrangement between you and your creditors.
It allows you to repay unaffordable debt, at an affordable rate, over a longer period of time.

Payments are decided by your household budget, so you take your income, deduct your essential payments such as rent/mortgage/utilities/council tax/food etc etc, basically everything you might need to spend money on, and then what is left, is your disposable income.

As long as there is sufficient disposable income to pay each creditor at least £5 per month, then a DMP is possible.

If there wasn`t then you would need to look at other solutions, but there is no negative balance, only what`s left after essential payments can go into a DMP, as that is the whole point of it.