DMP

Hi, on previous posts I've been on breathing space which ended yesterday, but now expect to start being chased for payments for the last two months I've missed, Been told best to not start a DMP until default letters come, but so far have only received arrears notice letters, but trouble is I have a close family member that leans on me and the wife a lot as they are not well, and I'm not looking forward to all the pressure, am I better just starting a DMP and just accepting that my credit file will be affected longer, what with work, family and this I don't want my own health going down hill I'm already snapping at people now and I could lash out with all the stress built up inside me, and I don't want to let my family down anymore, I'd appreciate any advice, thank you.
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Comments

  • Wanting to sort out your debt situation is certainly not in any way "letting your family down" so try to let go of that feeling if you can, you're taking an incredibly strong step forwards in looking to put a solution in place - well done! 

    When you say your close family member leans on you - do you mean financially? If so then if you are at the stage of starting a DMP then I'm afraid you are quite simply going to have to tell them that the magic money tree isn't bearing fruit any more. Can you offer practical assistance instead - for example helping them to check whether they are entitled to benefits/increased benefits? Or maybe offering to go through their budget with them to identify any possible savings they could make to help things along? What you cannot do is give them money you don't have. 

    If you have already missed two months payments to the debts then if possible try to hold strong and wait out the defaults - they should start coming in another couple of months with luck, and in the longer term it would be better to get the defaults in place. The process is underway - if you can bear to let it run its proper course then so much the better really. 
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  • SusieT
    SusieT Posts: 1,267 Forumite
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    Getting the arrears notices is a good start, now they have started you are on their computer as not paying, so it should not be too long before the default notices start to arrive, you may even have them by the end of the year so can start the new year knowing there is an end date for most of them. Try to relax about the debt and just let it roll over your head, concentrate on helping the family members who are needing you, and remember you are NOT lettin them down, you are starting the road to a better, debt free life :D 
    Credit card debt - NIL
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  • Do it whichever way works best for you, there's not really a wrong answer.

    I found it easier to start a DMP with Stepchange as soon as I could (before the breathing space ran out). So far (4 months in) only one of my debts has defaulted. So it will take a bit longer to clear from my credit file, but for me that was worth not having the stress and uncertainty.  The other thing is you have less time to build up an emergency fund. But Stepchange have let me skip a month's payments to cover vet treatment for my cat this month, so that's worked OK for me.
  • Rob5342
    Rob5342 Posts: 1,446 Forumite
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    edited 1 November 2022 at 9:32PM
    Waiting for them to default should be less stressful as you'll be able to save the dmp payment and have extra money put aside. The letters you get are all standard and once you've got a few you get used to them as you can see they are all going through the motions.

    It's up to you how you handle it but consider it very carefully. Starting a few months early now and not getting defaults could mean your credit report has bad markers for 5 or more years longer which could be a huge problem in the future. It's an odd quirk but starting to repay earlier means your creditors treat you a lot worse than they would if you ignored them until you default.
  • natlie
    natlie Posts: 1,687 Forumite
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    I went straight into my DMP and most of mine defaulted within a year, if you have a look on the DMP Support thread there are people who waited a year before having defaults even when taking a no pay approach. I am so glad I went straight into my DMP as it'll not be paid off in around 18 months. 
    DMP: £30,668 £3,364.02 DFD July 2024
  • Rob5342
    Rob5342 Posts: 1,446 Forumite
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    There are lots of ways to handle it. For example you could save the money now and pay it off once they have defaulted so the repayment time would be the same.

    Another thing to consider is that the sooner they default, the sooner they will get passed to debt collection agencies who will be likely to accept reduced offers.
  • Beck50
    Beck50 Posts: 84 Forumite
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    Today in fact 5.19pm Barclaycard looks like the first one to ring my home chasing missed payments, I googled the number and found comments on the number being them, is this normal now after breathing space has ended.
  • SusieT
    SusieT Posts: 1,267 Forumite
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    Beck50 said:
    Today in fact 5.19pm Barclaycard looks like the first one to ring my home chasing missed payments, I googled the number and found comments on the number being them, is this normal now after breathing space has ended.
    That is perfectly normal, means the computer has flagged you as having not paid, and it will be slowly whirring its way through the programmed letters and then the default.
    Credit card debt - NIL
    Home improvement secured loans 30,130/41,000 and 23,156/28,000 End 2027 and 2029
    Mortgage 64,513/100,000 End Nov 2035
    2022 all rolling into new mortgage + extra to finish house. 125,000 End 2036
  • Beck50
    Beck50 Posts: 84 Forumite
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    I appreciate your comments knowing your not alone and can reach out means a lot, thank you.
  • Rob5342
    Rob5342 Posts: 1,446 Forumite
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    Remember that this is a good thing, as soon as you get a default then you have a date when it will drop off your credit report completely.
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