Default and Creditor Contact Help

Savenotspend123

My husband and I have started the process of cancelling direct debits, we have set up a new account and we are now not paying creditors for non priority debts. We are starting an emergency fund too. I just have a couple of questions please?
When the accounts start to default do I then contact the creditor to explain my position , if so, should it be a letter and if so what should be said and do I have to include an SOA? I assume you contact each one as you receive the default and not wait for all of them?  We have worked out out SOA however in August our situation changes which  will result in even less income so we are considering either a self managed dmp or a DRO each dependant on the income in August. Step Change advised dmp or DRO but I want to manage it myself. I.must admit I feel much lighter already! And to be able discuss it with you all and get advice is so reassuring so thank you. I expect I may have a lot of questions going through the process but I have already learnt so much from you all.

Grumpelstiltskin

What ever you do don't phone any of the creditors, they will only try and push you into agreeing to something you don't want to do.
Communicate by letter or E Mail, August is very close you probably won't have received any default letters by then, so you can wait until then and see what the situation is.

fatbelly

If you qualify for a DRO, do a DRO and don't flag it up in advance.

You can have up to 2k in assets/cash and separately a 4k car and still qualify so get things in orderr.

The only letter you need to respond to is a standard preaction letter that comes with reply form and 30-day limit. You are unlikely to get one

sourcrates

No real need to send any letters, unpaid accounts are usually sent to a debt collector or sold.

Wait until you are written too, payment arrangements can be set up on collectors websites with no correspondence necessary.

If you opt for DRO, you will need to speak to an intermediary.

Savenotspend123

Ok thank you, so no contact, just wait. What about if I have a bank account which I have left overdrawn? Do I need to tell them or does the same apply? I assume it will stay dormant with a negative balance and accrue charges each month until it defaults? 

sourcrates

Slightly different advice for bank accounts, nothing to stop you writing to them and explaining your intentions.

Savenotspend123

Thank you. Would I just say I am in financial difficulty and seeking advice for a solution? Anything else I should add or is there an example letter in the group? 

sourcrates

Savenotspend123 said:

Thank you. Would I just say I am in financial difficulty and seeking advice for a solution? Anything else I should add or is there an example letter in the group? 

Just say you are in financial difficulty and as a result you are unable to service the account at present.

Ask them to default and close it ASAP.

They will then more than likely pass it to a debt collector.

Savenotspend123

Thank you for your help

ManyWays

Why do you not want a DRO? How large are each of your debts?