Dmps and child savings

Ross891

Hi there, newbie here. I'm looking to enter a DMP due to debt problems. The worry is I have a junior isa set up for my child in the same bank I owe a debt to. Is it possible for that bank to chase the money owed through that isa? 

Grumpelstiltskin

Before you think about starting a DMP have you let your debts default? Is the DMP with one of the charities?

You need to put up a SOA on here to get the best advice of your way forward.

Edit.. Link to SOA.
https://www.lemonfool.co.uk/financecalculators/soa.php

Format for MSE and post on here.

sourcrates

Whose name is the account in, yours or your child`s ?

A bank can’t take money from your account without your permission using right of offset unless the following conditions are all met:

1. The current account and the debt are both in your name. 
2. The current account and debt are both with the same lender. 
3. The debt they’re taking money for is in arrears. They can’t take money by right of set-off if the debt repayments are up to date
4. They’ve warned you clearly in advance that they may use right of set-off if you don’t contact them or pay back your arrears
5. They’ve taken your individual circumstances into account and whether taking the money might cause you hardship

In practice it’s very rare for banks to exercise this right.

Ross891

My child is 9 so I'm guessing because i opened it, it would be in my name as I opened the junior isa for her just after she was born, I'm really concerned now. The debt is an overdraft to the bank, I'm looking to switch all payments to a new bank in the next few days.
I also have 2 loans and 2 credit cards with different creditors , I speak to the dmp tomorrow. So I will find out more then... Thanks for the advice

flipflopflo

Who are you doing a DMP with?

Ross891

Money plus will be calling Me

fatbelly

Hmm. Pretty much IVA-pushers. If they do a dmp they will charge a fee.

Stepchange and Payplan won't

lillypoo

Don't use moneyplus. They're going to charge for their services.  Look up stepchange or national debtline. Read the advice on https://nedcab.cabmoney.org.uk/debtremedy.asp
Read everything that you can on this forum

Most importantly do not pay anyone to help you with this. There's no need. 

sourcrates

Ross891 said:

Money plus will be calling Me

Oh......we really would not advise doing business with a fee charging company, as stated above, the debt charities do just the same job, for no charge whatsoever.

You can also do it yourself you know.

It`s a very common newbie choice when they are unaware it should be a free service, so don`t kick yourself, just get in touch with stepchange or payplan instead.

Never use a fee charging company for a DMP, your just wasting your money doing so.

Rob5342

If it's a junior ISA then it can only be in the child's name.

As.mentioned above it's advisable to let your debts default before you start a DMP. Once defaulted the debt will drop off your credit report after 6 years and will be passed to a DCA who may accept a reduced settlement offer later. If you go straight into the DMP you will probably get arrangement to pay markers.on your credit report which stay on for 6 years after you clear the debt so your credit report could be harmed for twice as long. It's completely counter intuitive but that's the way it is.

I strongly advise against using Money Plus, hidden away on their website they say they charge £400.for setting up the and then £46 or 49% of your payment each month as a management fee. For a 5 year DMP that's over £3000 they cream off which could go towards your debts instead.. Stepchange and PayPlan are completely free so every penny you pay goes towards clearing your debts. It easy to manage yourself too.

Ross891

Thank you so much for advice on the junior isa that has really made me feel so much better