Reduced payment plans

sonnet72

Hi, 
I’m just starting a new thread to try and understand the pros and cons of reduced payment plans. Do they just mean that you pay a reduced amount and take longer to clear your debt? So interest remains the same, the debt amount remains the same, the only thing that changes is the monthly payment and therefore the loan term? 

I have 3 creditors, I wrote to them all separately asking if they would consider writing off my debt due to my extenuating circumstances.  one of them to whom I owe £10k has asked me if I will agree to a reduced payment plan making monthly contributions of £15 ( used to be £217) . 

Now they haven’t said anything YET about freezing interest or writing some of the debt off, so assuming they don’t do that it will take 55 years to pay it back. 

On top of that, if you’re aware of my situation from my previous thread, I have 2 more creditors that I’m waiting to hear from to whom I owe £33k and £13k. 

In principle I can make these really small payments to each one. IF they all suggest this, I just don’t  want to be in debt till the day I die which will be definite of there’s no write off . 

Clarity please! I should change my  forum name to “desperately seeking clarity” because everything is so confusing and you guys seem so very clued up. 

Grumpelstiltskin

You should not be thinking about any possible reduced payment plan until you have completed the debt write off due to health route, only then if any of your creditors refuse to do that does this possibly come into play.

Forget about this angle and concentrate on one this at a time.

sourcrates

You are really all over the place with this, you need to slow down, and concentrate on one strategy at a time not keep jumping from pillar to post.

Your position remains that you have insufficient income to service your debts, so your aim is to inform all your creditors of this, and get them to write off what you owe.

Nothing more at this stage, no payment plans, no IVA , nothing, debt write off is your sole goal in all of this.

sonnet72

Gosh. You’re right - I am all over the place. Thankfully there’s a small window that opens randomly, once every 24 hours when I think straight for no more than 10 minutes. 

I wrote to my creditors in said window on Monday, posted the letters on Tuesday. After hearing back from 1 creditor on  Wednesday, that window remained tightly shut until about 4am today and I replied to the creditor rejecting there offer of a reduced Payment plan and reiterating my request for a complete write off. 

Back to being all over the place… . 

sonnet72

Ok so 1 creditor has written off my debt. Once that defaults and gets officially written off , I’m hoping within 6 months (2 already passed), then my debt total will be under 50k,
 at that point should I go for a DRO? 

sourcrates

I would do as advised previously, there is no rush here, try and get as much written off as possible.

If you are not being chased, there is no reason to change strategy, stick with the plan.

sonnet72

UPDATE:
 Tesco have now offered me a token £1 payment plan …. Which must obviously be temporary. Considering my financial situation is unlikely to change, do I accept with the hope that they will soon realise that nothings changed, sell the debt and new creditors will realise there’s no chance of me repaying and hopefully write it off. 

Maybe I’m I just wishful thinking? 

Also will this be a way to persuade NatWest to do the same? They both said no to writeoff so far. 

Or do I refuse the £1 plan stating that won’t be feasible in the long run and continue to twiddle my thumbs whilst they both sell my debt and then new creditor realises I can’t pay? 

If I’m honest I prefer option 1 

sonnet72

@fatbelly can you help?

ManyWays

I think you should sit back and review in 4 months time. If more have written off the debts at that point you may feel it's worth while continuing with that route. If not, revisit a DRO and discuss the pros and cons then. I know you would like clarity but at the moment you don't know how your creditors are going to react.