Opening a new basic bank account...start of journey

agentblackcat

Hi everyone, 

Firstly Hi! I'm new and following your threads with interest. I'm considering a DMP and have started a conversation with SC. Can anyone recommend a basic bank account. I have considerable amount of debt with various different banking groups, RBS, Nationwide, MBNA, Barclaycard. 

Thanks

Grumpelstiltskin

Hold on a moment, before you jump into a DMP have you let the debts default?

Have you sent CCA requests?

Have you stopped paying them?

Have you built up an emergency fund?

When you have the answer to those questions you can look at a basic bank account.

fatbelly

agentblackcat said:

Hi everyone, 

Firstly Hi! I'm new and following your threads with interest. I'm considering a DMP and have started a conversation with SC. Can anyone recommend a basic bank account. I have considerable amount of debt with various different banking groups, RBS, Nationwide, MBNA, Barclaycard. 

Thanks

That leaves you with Santander, which I've found quite easy to get started with, HSBC,co-op, virgin

https://www.moneysavingexpert.com/banking/basic-bank-accounts/

I personally wouldn't worry about the links of Barclaycard to Barclays or MBNA to Lloyds but there are better accounts elsewhere

Rob5342

Starling and Monzo are good too, their apps have lots of budgeting features that can be very helpful. There is also Chase.whch gives you cashback on debit card spends.

I have three defaults and all three banks have given me accounts. They don't have specific so called  basic accounts, but just give you their normal account with no overdraft if you have bad credit. I've never understood how what some banks call a basic account differs from simply not giving you an overdraft facility. In any case if you open it before any late payments or defaults show up on your credit report they night just give you their standard account anyway.

fatbelly

Rob5342 said:

Starling and Monzo are good too, their apps have lots of budgeting features that can be very helpful. There is also Chase.whch gives you cashback on debit card spends.

I have three defaults and all three banks have given me accounts. They don't have specific so called  basic accounts, but just give you their normal account with no overdraft if you have bad credit. I've never understood how what some banks call a basic account differs from simply not giving you an overdraft facility. In any case if you open it before any late payments or defaults show up on your credit report they night just give you their standard account anyway.

I did spot Metro and Cashplus on the list

https://www.moneyhelper.org.uk/en/everyday-money/banking/use-our-compare-bank-account-fees-and-charges-tool

Sly72

Grumpelstiltskin said:

Hold on a moment, before you jump into a DMP have you let the debts default?

Have you sent CCA requests?

Have you stopped paying them?

Have you built up an emergency fund?

When you have the answer to those questions you can look at a basic bank account.

My plan was:
1. I stopped paying them
2. I built up an emergency fund
3. Waited for debts to default
4. Waited for letters asking for payment debts may have been sold
5. Then ask for CCA request but it depends on when taken out.

fatbelly

That sounds like a good plan

agentblackcat

Grumpelstiltskin said:

Hold on a moment, before you jump into a DMP have you let the debts default?

Have you sent CCA requests?

Have you stopped paying them?

Have you built up an emergency fund?

When you have the answer to those questions you can look at a basic bank account.

Hi, thanks for your reply. No I'm just in the process of stopping paying these debts. 

My plan is to set up new bank account, as my current account as a overdraft and loan linked to it. Then to not pay the non priority payments and contact my creditors to tell them I'm seeking advice and need breathing space. This hopefully allowing me to build an emergency fund. Then once I have this start dmp. Should I wait for defaults? 

My only concerns are that interest and late fees will increase my debt further. Also I'm a signatory on bank account for my work. Its the same bank I currently bank with and have debts with. Will this affect my job. 

SC are recommending a DAS ( I'm in Scotland ) rather than DMP. Not sure what is best. 

Thanks to everyone else for advice about accounts too. 

Rob5342

If you talk to them now they are likely to put you on a payment arrangement and may default the account later. If you ignore them then they are more likely to default the account more quickly. A payment arrangement comes off your credit report 6 years after the debt had been paid off, but a default comes off 6 years after it went on. In the long term it's better to try and get defaults that will come off sooner than payment arrangement markers that could stay there for a lot longer. It will mean extra interest and late fees now, but that will be outweighed by having a clean credit record sooner. Also, once defaulted the interest will be stopped for good, v and the account is likely to be sold to a DCA who will be more open to a reduced settlement offer than the original creditor.