Many questions around debt, defaulting and DMPs

Atthebottomofeverything

Hi there, 
My partner and I have racked up on whole around 18k in debt. 
Admittedly in comparison to others this is small. 

I want to start atta king this head on. I read I think on here that utilising defaults rather than a DMP may be beneficial?

My concerns on how to manage this are purely focused around impacting my job if I do this.

I work for an insurer and am subject to an annual good repute check. This includes a credit check. How likely will this impact me to the point where my job could be at risk.

I am not sure if this makes any difference but I have ADHD and as such my spending habits are somewhat impulsive. I am working on this, but will take time.

I have tried to fill out the SOA but, I honestly don't have that level of concentration in me tonight. I will try post over the weekend. 

stu12345_2

how do you plan on paying back the debts once you have let them default.

and does your employer just check for ccjs and insolvency.

cos defaults are not insolvency obviously and neither is a dmp

defaults and DMP will just lower your credit score


avoid compulsive spending by not taking your bank card when you go out, just take a certain amount of cash with you instead .

eg gamblers carry a tin that they put their winnings in and the key is left at home so they can't touch it on their nights out.

Atthebottomofeverything

stu12345_2 said:

how do you plan on paying back the debts once you have let them default.

and does your employer just check for ccjs and insolvency.

cos defaults are not insolvency obviously and neither is a dmp

defaults and DMP will just lower your credit score


avoid compulsive spending by not taking your bank card when you go out, just take a certain amount of cash with you instead .

eg gamblers carry a tin that they put their winnings in and the key is left at home so they can't touch it on their nights out.

I think if I am realistic / clever enough I may not end up defaulting on anything. I was hoping to rather than small minimal payments across the board. Pay off larger chunks and clear higher interest/least cost efficient debts off first, this would be credit cards and overdraft primarily. Then likely to finish with loan and other smaller bits BNPL. 

Just trying to find out what is feasible.

Rob5342

A DMP involves paying less that the contractual amount, so it all depends on if you can meet that or not. If you do start a DMP then the question is how you deal with the creditors. Option 1 would be to talk to them about it, they would probably agree to freeze the interest but your credit report would have an arrangement to pay marker which would stay on for 6 years after the debt was cleared. Option two would be to stop paying until they default, and the default would stay on your credit report for 6 years after it was applied. It's far better for your credit report to take option 2 and let them default.

If you can meet the minimum payments then you might be able to clear them without a DMP. That might work out well but the danger there is that if things don't go to plan you may end up defaulting and on a DMP anyway a few years down the line.

If you post an SOA then people can advise further.

You'd need to ask your employer about what they look for with a credit check. A DMP is an informal arrangment as doesn't show up explicitly, but the resulting missed payments, arrangements to pay and/or defaults will.

fatbelly

I agree with Stu - see if you can find out what sort of credit check gets done. Letting agents don't see defaults.

If you have to avoid defaults this could be very difficult but post the soa and we'll have a look at it

Atthebottomofeverything

Rob5342 said:

A DMP involves paying less that the contractual amount, so it all depends on if you can meet that or not. If you do start a DMP then the question is how you deal with the creditors. Option 1 would be to talk to them about it, they would probably agree to freeze the interest but your credit report would have an arrangement to pay marker which would stay on for 6 years after the debt was cleared. Option two would be to stop paying until they default, and the default would stay on your credit report for 6 years after it was applied. It's far better for your credit report to take option 2 and let them default.

If you can meet the minimum payments then you might be able to clear them without a DMP. That might work out well but the danger there is that if things don't go to plan you may end up defaulting and on a DMP anyway a few years down the line.

If you post an SOA then people can advise further.

You'd need to ask your employer about what they look for with a credit check. A DMP is an informal arrangment as doesn't show up explicitly, but the resulting missed payments, arrangements to pay and/or defaults will.

Hi there looked on the intranet and what the practices were for my organisation. Only things vetted are CCJs, IVAs, Bankruptcy, and DMAs. 
There is no mention in risk criteria for defaults. So I am wondering if I could make this work. 

As a general ask to anyone watching/reading the thread. Could you link me to the SOA? 

stu12345_2

https://www.lemonfool.co.uk/financecalculators/soa.php