Starting a DMP

Fairy_Cakez

I decided to do a debt management plan a few months back after looking at advice online mainly from StepChange and on here. 

Following advice on here I stopped all direct debits in order to try a build up an emergency fund , clear some outstanding payments and wait on accounts to default. It has only been a couple of months and a two of the credit card companies have said about passing it to debt collection agencies, what do I do here? 

I also had some questions about DMPs as I have a joint mortgage with a fixed five year interest rate which expires in 3yrs - have people been okay with getting new rates? What if I decide to move? Similarly with a car on PCP? 

Also I know that in 2yrs time I will get a decent amount of money from inheritance - with this is it worthwhile to settle the DMP when that time comes around. 

I appreciate any and all advice. Thanks 

RAS

Joint mortgage, you just transfer to the best deal offered by your current provider. Moving is much more difficult.

Debt collection agencies are just companies employed by the creditor who specialise in trying to get debt repaid. No more rights than the original owner, in fact less as they can't take legal action.

Rob5342

Just keep waiting until they do default. They can be r passed to collection agencies without defaulting.

If you move to a new fixed rate you will be fine as most banks dont do a credit check. I have four defaults and got a new fixed rste with Santander with no problems. Moving will require a credit check so defaults will make that a lot more difficult. 

It will be worth uaing the inheritance to clesr the debts, but whatever you do, don't involve Stepchange with that. They will want you clesr everything in full which is absolutely apalling advice. if you approach the creditors yourself you can make offers and clear them for maybe half their value. You'll need to strike the right balance between clearing the debts and leaving yourself enough that you won't need to borrow again. 

Rob5342

RAS said:

Debt collection agencies are just companies employed by the creditor who specialise in trying to get debt repaid. No more rights than the original owner, in fact less as they can't take legal action.

True, they will try their best to make you think they can though with wording like further recovery action, or giving you 14 days to do something to try and make you think its a legal notice. Read it a second time and it's obvious they are trying to fool you. 

ManyWays

When does your PCP end? These are normally more of a problem for DMPs than mortgages are - if you are with a normal high street mortgage lender they will offer you a new fix whatever your credit record is like.

But you will have great difficulty in getting another PCP or borrowing the money to clear the PCP balloon payments at a reasonable rate. 

Sorting paying off the PCP finance or a replacement car out may be your top priority with any inheritance money. After that, make partial settlement offers to as much of the DMP debt as possible.