Debt Management plan

stu12345_2

creditors love debt charities cos it means repayments as soon as possible for them.
debt charities are actually funded by creditors as the creditors have to donate a tiny % of their profits to charities, 

some say it's biased, but it's  far better than these paid for debt payments  scam companies, that take  fees from you monthly, avoid them.

so yes, use PayPlan, step change when it is at the best point in your plan to repair credit file as fast as possible. like you read, at default time 

Rob5342

gerrard88 said:

Thank you. I have just read them now. I am worried about going months wirhoht paying anything rather than going into the DMP with payplan

Creditors can't take legal action against you unless an account has defaulted, and if you then start making payments they are very unlikely to take it. Defaulted debts are nearly always sold to DCAs who buy them at a fraction of their value as a multi year investment. If they spend £1k on a £10k debt then after 3 years of someone paying £60 a month they've more than doubled their money. There's not much reason to spend time and money on legal action when they have money rolling in for nothing 

Its likely that debts will default at some point on a DMP, so by waiting for them to default first you can speed the whole process up.

Unfortunately some creditors make things difficult for people.by delaying defaults.

gerrard88

Great thanks all. Some of my credit card payments are due soon. So I will not pay these for months?

how do I know when default and I need to sort the DMP?

Seems that is best wah and not go into a DMP tomorrow

would our joint mortgage be affected when ww renew our fixed in 2 years time?

stu12345_2

yes, creditors will go good cop bad cop with you, it's amusing, they will write you are in arrears, please catch up, you are seriously in arrears, we may take further action, you are still in arrears, please phone us as we are here to help, call us so we can best let you see what you can afford.

it would be truly best if they just  wrote, here mate, your account is defaulted, we sold your debt on, all the best, goodbye.

Rob5342

I'd suggest stopping payments to all unsecured debts, and then live to your DMP budget putting the debt payments you will be making into a emergency fund.

The creditors will send you a default notice before defaulting you giving you a date to pay by to avoid the default. Once that's passed they should default your account.

The defaults will make it difficult to obtain new credit, but most banks will switch you to.a new fixed rate without requiring a credit check. I have four defaults and got a new fixed rate with Santander no problem.

gerrard88

Thanks for all the great advice. 

I just worry that if i do not pay for momths etc. i know my credit file looks bad now but will look worse

I actually just thought by doing the payplan DMP with one of monthly payment would really help me out

stu12345_2

gerrard88 said:

Thanks for all the great advice. 

I just worry that if i do not pay for momths etc. i know my credit file looks bad now but will look worse

I actually just thought by doing the payplan DMP with one of monthly payment would really help me out

it will help you out, but not right now! wait till defaults

You're in debt, you don't want or dont need or  cant get anymore credit.

thus your credit file is very poor at the moment, you can't afford  normal repayments., no one is going to lend you £30000 interest free .

the best interest free plan is when you default in debts , cos interest stops at that point.

so you have to clear all your debts , all off, in a payment plan, then at you can do what you like , at the end, once your debt free, and credit file will be good again 6 years from date of DEFAULT.

Floss

And re: your mortgage renewal, you will very likely be able to move onto a new deal with your existing lender without any credit checks, many posters have done that while in a DMP.

Rob5342

gerrard88 said:

Thanks for all the great advice. 

I just worry that if i do not pay for momths etc. i know my credit file looks bad now but will look worse

I actually just thought by doing the payplan DMP with one of monthly payment would really help me out

Your credit file will look bad anyway on a DMP as it will be marked with arrangment to pay markers and/or defaults. That's just something you have to go through with a DMP and it will eventually recover.

The payplan DMP will help you out, we are just suggesting that you let the accounts default before you start it so you credit report is only harmed for 6 years instead of the 10 years+ it might be if you start the DMP straight away.

gerrard88

Thank you all