Stepchange DMP advice please

Summerbreezemakesmefeelfine

In October 2022 I entered into a DMP with Stepchange. I didn't fully read the forum properly as I was desperate and in a panic. I now know that I should have let all my accounts default before setting up the payment plan

Stepchange were great though and set up token payments to all 9 of my creditors which apart from some letters and phone calls kept them off my back.  I've been paying £9 a month since. Only 3 have defaulted me. I've checked my credit file and a few of them have marked me with arrangement to pay. I could kick myself for not reading up properly. What should be my steps now to get the other creditors to default me? Do I stop paying my £1 token payments to stepchange? I would very much appreciate some advice please. All debts are unsecured  debts so catalogues, loans and store cards / credit cards etc.
Or is there another way? 

Many thanks  

fatbelly

Yes, this is why we advise the course of action that we do.

As things stand the negative marks will never disappear from your file (well not until you are 144 years old anyway)

Token offers should only ever be used as a short-term stopgap anyway. What was the long-term plan? 

Are you going to ever have enough surplus to pay these off in a reasonable period, say 3-5 years?

Is there a reason why you could not go for an insolvency option like a DRO?

CharlieD2k

Sorry no advice but why do you need to let all your accounts default? Should you not get a DMP if you aren't in arrears? 

fatbelly

The OP does not have enough surplus money to meet the contractual payments and barely enough to meet their essentials

Hence they have been put on a token payments dmp

How the credit file is marked may not be an important issue here but in general - a default makes the whole entry drop off 6 years later. An arrangement to pay means the account stays until 6 years after it is settled, which will be a looooong time.

Summerbreezemakesmefeelfine

Thank you fatbelly. Sorry if I have not explained it properly. That was my reason for joining the dmp.

I will pay more money off my debts later this year as I am expecting my income to increase. I was just in a desperate place in October with not enough money to buy the basics. I have depression and anxiety and Stepchange helped me out of a black hole and sorted breathing space for me. 

I want to default asap so In 6 years my credit file will be better should I wish to move house. I now know I should have let the debts default and then arranged the dmp with Stepchange.

What shall I do? Can I ask each creditor to default me? Will they do that? Or should I stop the token payments until they default me and then carry on paying once I have been defaulted? I don't know what's best. If I didn't want to move in the future I wouldn't have been too worried, but I live in a high crime area and want to move my children out of the area before they start secondary school. 

fatbelly

You can stop the payments AND ask for a default. Start the dmp proper when you have a sensible surplus.

Make sure you have an emergency fund of at least one month's income.

If you can save on the side for full & final settlement somewhere down the line, so much the better.

Summerbreezemakesmefeelfine

Thank you so much fatbelly. I will stop the payments. Do I tell Stepchange I want to stop the payment or should I just cancel my direct debit with them for now and get back in contact once all my defaults and emergency fund are in place? 

RAS

It would be better to just let Stepchange know that you are cancelling the DMP. 

Did they set up a Direct Debit? Or did you set up a Standing Order. They can cancel the former but you have to cancel the latter.

Summerbreezemakesmefeelfine

I will give them a call tomorrow. It is showing on my banking app as a direct debit. They take £9 on the same date every month.

RAS

In which case, you need to tell them to cancel the DD and confirm the date they can do it, not easy at very short notice.