DMP mutual support thread part 13 !!

chm26

Hi all, I've been lurking on these threads trying to get the best advice going forward. I have decided that a DMP is going to be the way I tackle my debts. From the advice on here, I have opened a new bank account away from any of my creditors, have cancelled all of the DD's bar one as I have a question about it if I may. 
My mortgage is with santander and one of my CC debts is with them. My question is, am I best not to default on the CC with my mortgage provider incase it affects the relationship and ultimately affects my mortgage going forward. I am planning on switching product with them in April as it will still be cheaper than dropping to the SVR. 
Any advice would be greatly appreciated. Thanks 

sourcrates

chm26 said:

Hi all, I've been lurking on these threads trying to get the best advice going forward. I have decided that a DMP is going to be the way I tackle my debts. From the advice on here, I have opened a new bank account away from any of my creditors, have cancelled all of the DD's bar one as I have a question about it if I may. 
My mortgage is with santander and one of my CC debts is with them. My question is, am I best not to default on the CC with my mortgage provider incase it affects the relationship and ultimately affects my mortgage going forward. I am planning on switching product with them in April as it will still be cheaper than dropping to the SVR. 
Any advice would be greatly appreciated. Thanks 

One is unsecured borrowing, the other is secured, defaulting on the card will in no way affect your mortgage account.

These systems are automated remember, no one will notice and put two and two together.

Re-mortgaging with the same lender does not normally require a credit check, so there is no need to benefit one creditor over another.

chm26

sourcrates said:

chm26 said:

Hi all, I've been lurking on these threads trying to get the best advice going forward. I have decided that a DMP is going to be the way I tackle my debts. From the advice on here, I have opened a new bank account away from any of my creditors, have cancelled all of the DD's bar one as I have a question about it if I may. 
My mortgage is with santander and one of my CC debts is with them. My question is, am I best not to default on the CC with my mortgage provider incase it affects the relationship and ultimately affects my mortgage going forward. I am planning on switching product with them in April as it will still be cheaper than dropping to the SVR. 
Any advice would be greatly appreciated. Thanks 

One is unsecured borrowing, the other is secured, defaulting on the card will in no way affect your mortgage account.

These systems are automated remember, no one will notice and put two and two together.

Re-mortgaging with the same lender does not normally require a credit check, so there is no need to benefit one creditor over another.

Thanks so much for your reply. I'll cancel that DD then and start building my EF. Today is the first time I've missed any payments and while it absolutely terrifies me and it feels really weird, I also feel a sense of relief, strangely, that there is a plan and in time it will be OK. Have I seen mentioned somewhere also that as soon as a default is recorded I need to contact that creditor to let them know I am getting a DMP set up. Are there any templates for this re: what exactly I should say? 

sourcrates

No, you don`t need do anything, the lenders you have currently may not be the same ones you enter debt management with, debts are sold, or assigned to collection companies, wait until you are written too asking for payment.

dollhead

Hi All

both myself and my Partner have been scrolling through the library of information on this topic and it has all been very helpful.

so our story in a nutshell:

last year we were both earning a decent wage (85K combined) and were enjoying ourselves. throughout last year my partner had to change jobs for various reasons and ended up taking a 11k drop in wages. I too had various work related issues occur, change of shifts multiple times and the loss of overtime which has resulted in a 14k drop. We never really addressed these issues until last month and have now realised we cannot maintain our outgoings. (3 loans and a few credit cards totalling over 80k)

after reading through all the information it would seem that a DMP is the best way to go. we have filled in most of our details on step change (have not confirmed and set up) and they too advise a joint DMP as the best option.

just a few questions (yes I have read and seen the answer multiple times but I need someone to tell me as well )

once we have cancelled our direct debits (this feels very Alien as I have not missed a payment on anything in over 7 years), how long do we leave it before kicking things off with stepchange? do we have to wait for every account to default as some will want paying and some will take longer than others)

we are currently mid way through our 5 year fixed rate mortgage with Leeds, will this just continue onto a standard rate mortgage once this deal ends?

any help/Advice would be greatly appreciated

sourcrates

@dollhead
Can`t comment on the mortgage deals you might find, but we do advise stopping your non priority debt repayments for a while, prior to entering debt management.

You will need an emergency fund, use the debt repayment money to start this off, longer term, budget to save something on a monthly basis.

We normally advise defaulting prior to starting a DMP, all the interest stops, and you have a clear 6 year window till your credit file recovers, arrangement to pay markers are the alternative, which stay on file 6 years after the debt is repaid, so potentially a lot longer.

Usually defaults follow after a few months on a DMP anyway, and interest will be stopped by the lenders eventually, and if it isn`t you can complain, so defaulting prior to starting is not essential, but is seen as best practice, and you should start that emergency fund regardless.

ManyWays

we are currently mid way through our 5 year fixed rate mortgage with Leeds, will this just continue onto a standard rate mortgage once this deal ends?
Yes but you probably want a new fix instead of the standard variable rate. That wont be a problem providing you dont have mortgage arrears, see https://www.leedsbuildingsociety.co.uk/mortgages/switching-to-a-new-deal/ which says:  
"No affordability or credit checks - As long as you're keeping the same mortgage amount, term and repayment type."

dollhead

sourcrates said:

@dollhead
Can`t comment on the mortgage deals you might find, but we do advise stopping your non priority debt repayments for a while, prior to entering debt management.

You will need an emergency fund, use the debt repayment money to start this off, longer term, budget to save something on a monthly basis.

We normally advise defaulting prior to starting a DMP, all the interest stops, and you have a clear 6 year window till your credit file recovers, arrangement to pay markers are the alternative, which stay on file 6 years after the debt is repaid, so potentially a lot longer.

Usually defaults follow after a few months on a DMP anyway, and interest will be stopped by the lenders eventually, and if it isn`t you can complain, so defaulting prior to starting is not essential, but is seen as best practice, and you should start that emergency fund regardless.

thanks for the info. we have spent the last few days going through and changing email addresses and phone numbers on all affected accounts. we have started putting money aside too.

dollhead

ManyWays said:

we are currently mid way through our 5 year fixed rate mortgage with Leeds, will this just continue onto a standard rate mortgage once this deal ends?
Yes but you probably want a new fix instead of the standard variable rate. That wont be a problem providing you dont have mortgage arrears, see leedsbuildingsociety.co.uk/mortgages/switching-to-a-new-deal/ which says:  
"No affordability or credit checks - As long as you're keeping the same mortgage amount, term and repayment type."

thats great to know, thanks for the info

Inafunk2025

Hi! 

I just need some advice from someone who has had a DMP.

I am in debt for the first time in my life and it has became unmanageable. At present I have about £16k of debt across two credit cards and one loan.

I have been on stepchange and have been advised a DMP would be the best option for me. The only thing I worry about is that my mortgage fixed term will end in August 2026 and I am scared that I will not be able to remortgage with the defaults that will be on my file due to the DMP. This is making be so stressed and anxious and I don't know where to turn.

Does anyone have any experience of renewing a fixed term whilst on a DMP? I would be looking to go through the same provider. I just don't want to press the button and start the DMP until I know how this could affect me in the future.

Any advice would be really appreciated