Starting DMP

sourcrates

Rob5342 said:

Why is the FCA debt collection advice to harm people's credit reports for longer? It's seems bizarre for people that are struggling to repay.

Beck50 said:

Debt is a horrible word, people for whatever reason get into debt, if you don't already feel bad enough, yes I agree why do they punish you more with longer bad credit reports, probably the rules are made by people that do no know what it's like being in debt especially this time of year.

A lot of the debt advice agencies questioned this approach at the time, citing exactly the same reasons you both have, but it appears they are more concerned with an individuals ability to re-pay there current borrowing, rather than there ability to obtain further borrowing in the future, which I guess is understandable.

It just leaves those in situations like Beck50 in a position of limbo Unfortunatly.

Rob5342

sourcrates said:

Rob5342 said:

Why is the FCA debt collection advice to harm people's credit reports for longer? It's seems bizarre for people that are struggling to repay.

Beck50 said:

Debt is a horrible word, people for whatever reason get into debt, if you don't already feel bad enough, yes I agree why do they punish you more with longer bad credit reports, probably the rules are made by people that do no know what it's like being in debt especially this time of year.

A lot of the debt advice agencies questioned this approach at the time, citing exactly the same reasons you both have, but it appears they are more concerned with an individuals ability to re-pay there current borrowing, rather than there ability to obtain further borrowing in the future, which I guess is understandable.

It just leaves those in situations like Beck50 in a position of limbo Unfortunatly.

Even on that basis a default would be better as it would get sold to a debt collector who'd accept a reduced amount, with a payment arrangement you have to pay the whole lot.

Beck50

Have received my 1st call from CRS Debt Recovery in behalf of Drafty this morning, have also just checked my Experian credit report and none show as defaults although the letters state arrears and leaflet letting me know what I can do to contact support like Stepchange who I will be going with as soon as I'm defaulted but at present it just shows as 3 missed payments to everyone, I guess CRS will keep trying and sending me frightening emails or letters.

fatbelly

Standard letters.

Expect defaults at the six missed payment stage

Beck50

Is that how it panned out for you, in that it took 6 missed payments. 

sourcrates

Beck50 said:

Is that how it panned out for you, in that it took 6 missed payments. 

No, that is FCA guidance, (Fatbelly is a CAB debt advisor).

Expect your accounts to go to collections, internal and/or external debt collectors. 

Expect letters/phone calls/texts and emails.

Accounts may go through this collection process more than once, with more than one collector, defaults are usually applied after 6 missed contractual repayments, although not always.

Your accounts may be sold with or without defaulting.

Beck50

So after only 3 missed payments do you think that by March 2023 I should hopefully have received done defaults or will I be hunted down by then as this CRS company have today emailed me about setting up a payment plan with them, which I don't as I'd rather wait to start a proper DMP.

SusieT

Beck50 said:

So after only 3 missed payments do you think that by March 2023 I should hopefully have received done defaults or will I be hunted down by then as this CRS company have today emailed me about setting up a payment plan with them, which I don't as I'd rather wait to start a proper DMP.

You can ignore CRS, their computer is just churning out the programmed letters and emails to try and get you to contact them. Just wait for the default letter, it will eventually arrive and then you can decide if you want to pay them £1 a month until you start a DMP, or if you want to ignore them until you have all the defaults in. They are not going to hunt you down, its simply the computse doing what computers do. To them you are not a person, you are just an account number that is on a spreadsheet with thousands of others.

sortingthisout2023

Sorry for jumping on this thread. I am in a similar position to you Beck50 and looking to get defaulted then start DMP. Could I ask a question about the EF, obviously I know we should all have an EF. But will I need it before the DMP starts, or to pay off some of the DMP ect? Or is it just good to have sitting there. Thanks in advance

SusieT

sortingthisout2023 said:

Sorry for jumping on this thread. I am in a similar position to you Beck50 and looking to get defaulted then start DMP. Could I ask a question about the EF, obviously I know we should all have an EF. But will I need it before the DMP starts, or to pay off some of the DMP ect? Or is it just good to have sitting there. Thanks in advance

When you stop paying the debts and are waiting for the defaults, you make sure that the payments that you would normally put to the debts gets saved somewhere that you wouldd not be able to dip into them. Alongside that, you also save £xx a month for things like presents, car insurance/servicing/MOT, holidays. That way you are living within your budget by the time you start the DMP and will have an emergency fund in case something like a washing machine needs replacing. Be totally honest with the budget and make sure that you put the money away, a lot of people make the mistake of not doing that or using some for extras in other parts of the budget, so please do not fall into that trap