DMP Worry

knitter6462

Hi 

I started a DMP in January and am about to make my 2nd payment to PayPlan.  I had made all my payments to creditors and could manage until I went through a manic episode caused by coming down from strong medication I had before my hip operation in October.  I'd been waiting for 4.5 years and I never had a manic episode before.  I was on a complete high and took out loans, phone contracts and just spent and spent on presents and things I can't even look at now.  I am so worried now and was with mental health team last week and have been diagnosed with deep depression and anxiety.

I have 13 creditors.  I took 2 loans one was with everyday loans.  It was for 4150 and was shocked that it was costing over 10000 to pay back.  I had already paid 1035 to them but it now stands at 9382 on payplan.  They have agreed to plan and to stop charges but not interest.  I thought that was all the interest that they had applied.

Very haven't stopped interest and virgin.

I am so stressed and am at a loss as I don't want to end up with more debt than when I started the plan which is £20333.

I just don't know what to do.

Thx

Rob5342

We always recommend stopping payments to everyone and waiting for them to default the accounts before you start a DMP. Once defaulted all interest and charges stop, and you have a fixed date when the defaults drop off your credit report. If you go straight into it you can end up paying a lot more and having payment arrangements on your credit report which don't come off until 6 years after the debt has been paid off. That could potentially be 11+ years time instead of the 6 with a default.

I'd cancel Payplan, stop paying everything, start a DMP again when all the accounts have defaulted, and put the spare money into am emergency fund while you wait.

stu12345_2

hi, had a look at everyday. loans, it states loans are subject to affordability, how did they lend you a loan,if you are on a dmp or clearly couldn't afford the repayments, even if you got the loan shortly before the dmp.

they have a complaints section on their website.i think you should put in a complaint that they didn't do their affordability checks correctly 

fatbelly

I have a couple of thoughts.

Do you qualify for a DRO?

As you are with Payplan, have you discussed whether they would support you and make write-off requests using a mental health evidence form?

knitter6462

Thanks everyone.  I got the loan when I was manic by phone.  I am just so stressed but payplan have said my plan is going accordingly.  I'm just so worried about court action 

fatbelly

Court action is unlikely.

In your position I'd be annoyed to still be paying interest when on a dmp.

And if the debt resulted from a mental health episode, I'd be evidencing that and asking for write-offs

knitter6462

Thanks so much.  To be honest I just want this sorted so I can stop worrying.  I check things online about ccjs.  All the mental health team did was give my gp an option for cbt and recommended antidepressants.  They also gave me a safety plan.  I'm so anxious and am reading about ccjs.

fatbelly

You're on a debt management plan, making payments you can afford. A court might order you to pay LESS.

Why would any of them take court action?

Not going to happen.

I asked earlier if you qualified for a DRO. You didn't comment

knitter6462

Sorry no I don't qualify.  Thanks so much for your help.  I am just so stressed and with the amount of debt I owe.  

sourcrates

Its only money, they can`t take what you don`t have, seriously don`t get stressed over this, it can be sorted very easily and simply, non of your worst fears are going to happen, honestly between us on this forum, we have seen virtually every scenario, and its easy to predict how most creditors react.

You really need to assert yourself and remember you are not a victim here, this is why we promote self management because it puts you back in control and calling the shots, telling the creditors how things will be, not the other way around.

Living in fear of court action is not a productive use of your time, and its all a non threat in the end, all legal action achieves is you paying the debt back at a rate you can afford, if you can`t afford it the court won`t allow you to pay anything !!!

Legal action would probably benefit you more than the creditors !!

Honestly, don`t let your fears get the better of you over this.

knitter6462

Thanks everyone for your support.  I   appreciate your help so much.