First Steps

cod3

Hi there

On your SOA for secured debt you have

Mortgage...................... 205......(997)......1.15

Is that definitely 205 or should it be 205,000?

bon007

Yes should 205,000 thank you for spotting . 

Thank you for everyone’s help here.

Ok so the Barclaycard is defaulted and you state not rushing in just yet is there a website that helps you self manage an Soa and would the DMP start once they all default or will they start at different times ? With the Barclaycard I am worried if I do not sort something out now what will they do as this worries me a little ?

sourcrates

bon007 said:

Yes should 205,000 thank you for spotting . 

Thank you for everyone’s help here.

Ok so the Barclaycard is defaulted and you state not rushing in just yet is there a website that helps you self manage an Soa and would the DMP start once they all default or will they start at different times ? With the Barclaycard I am worried if I do not sort something out now what will they do as this worries me a little ?

OK, relax, what you have received is a bog standard default notice letter, something your creditor must send to you to comply with the terms and conditions of the consumer credit act, its for information purposes only, you don`t need to do anything, as you are wanting the account to default.

You need to take a step back here, don`t overthink things, I understand this is all new to you, it was to me as well once, but you need to understand how the system actually works, rather than how you perceive it to work.

Once the 14 days have passed, and bear in mind things move very slowly in debt collection land, Barclaycard will do one of 3 things, they will either sell your debt, or they may instead pass it to a collector to manage on their behalf, or they may do nothing at all.

All your debts will go through a similar process, there is no knowing, when this will happen, or what will happen to the debt, one thing is almost certain, no legal action will be taken at this point, they nearly always use debt collectors as a first point of call, legal action is mostly reserved for much further down the line, where its usually debt purchasing companies that instigate it, and only usually if you ignore them for any length of time.

There again, is a legal process to follow under the civil procedure rules, so you will have plenty of notice, and plenty of time to react to any proposed legal action.

You are at the beginning of a very long debt collection process, your accounts could be bought and sold numerous times over the next few years, there is so much you need to learn about this process, and the myriad of possibilities and scenario's that you may come across, it can be quite bewildering, so to keep things simple, once your accounts have defaulted, that is the time to make arrangements to pay, whether you do this as part of an organised DMP via stepchange, or via self management, its up to you.

The reason we want defaults, I believe it was mentioned in another post, is because all interest and charges stop when an account defaults, if your not particularly bothered about your credit file, then a DMP can be started anytime, but there is no obligation on creditors to stop interest on accounts that have not yet defaulted.

warby68

If you are finding this particularly stressful, it may be worth reconsidering going self-managed. It might be better initially to have the support (and some legwork) from one of the free debt management companies. There is nothing to prevent you later moving to self-managed.

enthusiasticsaver

I think it would be worth you contacting stepchange and investigate the possibility of them setting up the DMP.  As sourcrates says you  are at the beginning of a long road and there is no website to set up a DMP as such.  You either go through stepchange or another free debt charity so they do the legwork or you contact each of your creditors separately after they have defaulted you and set up individual payment arrangements through a self managed DMP. Nothing will happen initially except for you getting letters and maybe phone calls and some of the debts may be sold on.  None of this is anything to worry about.  Check out the DMP sticky thread as everyone on there has gone through the same process. 

bon007

Thank you for so much help and support . I am quite a worrier which is affecting my health as you do find this whole process quite overwhelming.

When you see this letters in black and white it was quite frightening. 

I understand there isn’t a website for doing a self managed SOA but if I was to self manage how do you figure out what should be paid to each creditor . 

This weekend I am solely concentrating reading all the helpful information on this site as I want to be clear in my own mind .

As it has been stated one account Barclaycard has now defaulted so I take it I wait for the next letter from them ? 

With organisations such as payplan and step change I was worried they expected you to set up the plan before the accounts default which I must have misunderstood??

I know I ask so many questions but I am
new to this and I do not want to make any further mistakes.

The thought of failure again scared me so  going through this process slowly is what I am trying to do so there is no room
for mistakes this time round . 

NeverendingDMP

If they are still ringing you about debts you can ask them to stop. They will take your number of their records if you withdraw permission to use it. Its all to do with gdpr or something 
Also if you feel overwhelmed one of the debt charities such as stepchange may help you organise it all. Then you just pay them  monthly sum and they divide It out.
Don't over commit though if some income isnt guaranteed.
Like like people have said its the start of  process. It feels scary I know but try not to panic and have some breathing space to decide what to do.
Good luck

Naomim

I don't think you have misunderstood.  If you rush into a dmp before your accounts have defaulted, your creditors have no incentive to default you and won't stop adding interest and charges.  It's a waiting game. Let them all default, in the meantime complete your SOA in readiness and make sure you save the payments you are missing to the cc companies as you will need an emergency fund with no access to credit. 

bon007

Hi Thank you so much for all being so kind with your advice and support.

Today I have set my steps as I really want to get organised by following all your guidance.

I have broken this in to steps as I am determined not to look back and achieve sorting this mess out.

I have included my steps below and as I am quite new to this would this be the correct way forward.

Step 1
Cancel All Payments to creditor's  and send letters to creditors (Completed)

Step 2 
Create SOA (Completed)

Step 3

Reduce Out Goings On Soa and continue with Emergency Fund (In Progress)

In relation to an Emergency Fund what is a realistic amount ?

Step 4 
Open New Bank Account Not Connected with creditors

Is there any bank account you advise when going in to a DMP ? I understand a lot of people use Starling ?

Step 5
Decide whether to use a charity for the DMP or go Self Managed

Step 6

Wait For All Accounts To Default

Step7

Set up DMP


Sorry I have broken this down in to steps but I am better at writing everything down to follow as I need to be more organised and I find this the easiest way


  

bon007

Hi 

I am just trying to get my head around the defaults . So far I have had a default notice from 3 accounts. 

I have created the SOA and looked where to reduce on this .

I will now go to a Debit charity like Payplan or SC or try or go self managed but my question is if I set up a Payment Plan  with a Debt Charity would they not want to start straight away and what happens if only 3 of the accounts have defaulted . Do I wait for every single account to default before this starts .

This is the bit of the process I am struggling to get my head around ? I understand you need to make sure the account defaults but how soon do you make token/affordable  payments to them ?