Overdraft dmp

sourcrates

No, not necessarily, say if you get paid £1500 per month, and your essential spending is £1400, that leaves you £100 to split between your creditors.

Do you see ?

That is debt management.

Ross891

Yes mate, I've just got to get my head out of the clouds and switch off from the previous overdraft, silly really I just thought adding it to my debt I would be able to use up that amount.. Thank you for the advice

flipflopflo

@Ross891 who are you thinking of doing the DMP with please?

Can you please pop your SOA up on here to let us have a look and see if we can better guide you. 

Fill it out warts and all with your situation as it is and not what you think we want to see. Press the format to MSE button and copy and paste to this thread. 

https://www.lemonfool.co.uk/financecalculators/soa.php

Ross891

I will already be back in my overdraft on Friday, I've just made a massive error and need to fix it 

RAS

There is next month, or the month after.

Just checking - are you paid 4 weekly and paying out on calendar months? As the is the trickiest situation to manage.

Ross891

I get paid the last working day of each month, I've not planned this well at all im so ashamed, I obviously needed a decent amount in credit before I decided to do a dmp

MatyMoo

You need to:
- set up a new bank account
- arrange for your pay to go in to this account
- set up your essential direct debits on this account 
- breathe 

then:
- sort out a statement of affairs - post it here for advice 
- as creditors contact you re your debts tell them you are in debt/organising a DMP/maybe offer a token payment 
- use the money you would pay to your creditors to save an emergency fund
- organise a DMP if it’s the best option for you 

lillypoo

Right

Open s new basic bank account with someone like monzo ...someone who is NOT in the same group as your current over draft bank

Tell work that's where the pay at the end of June needs to go

This month as every ESSENTIAL Dd comes out ..cancel it and move that dd to the new bank

On 30 June you no longer look at the old account.  Think of it as out of bounds.  From then on you have a new account..start writing down and keeping track of your budget ie what you pay in  , what your essential debts are each month. Go onto lemonfool and ir step change and work out from this what you have left over to eventually pay to your creditors but you don't start a dmp yet

After 30 June you do not pay your non essential debts. Just don't pay them. Turn your phone on to silent because from my experience they start ringing you after a couple of weeks.. you'll even get letters.

Read as much of this forum as you possibly can 

But for now get the new account set up , arrange for next pay to go into it and start moving Dds

Also put a SOA on here then you can be helped

Ross891

Thank you for your advice it really does mean alot

Rob5342

Ross891 said:

I get paid the last working day of each month, I've not planned this well at all im so ashamed, I obviously needed a decent amount in credit before I decided to do a dmp

Don't be ashamed, a lot of us here have been in similar situations but with the help and support here we have taken control of things and are now helping others.

Changing to living without access to credit can feel a bit unsettling at first but it's necessary to take control of your debt and after a while you will begin to feel in control of your money again. The idea of a DMP is that you start afresh with a new bank account with no overdraft facility and your old bank account with the overdraft gets treated like your other debts. You work out a budget based on your essential outgoings which may involve some cutbacks, and the excess over this budget is what you have available to pay your debts. You then start living within the budget and pay the excess to your creditors.

It's normally advisable to stop paying all your debts immediately and wait for them to default as that is far better for your credit report than if you start paying them straightaway. That seems completely counter intuitive but a default comes off your credit report 6 years after it was a applied, but if you start paying straightaway you'll get arrangements to pay which stay on your credit report until 6 years after the debt has been repaid. While you wait for defaults you can put the money you would have been paying to the debts into a savings account so you have money for emergencies.