We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
So stressed! DMP & Defaults

Sarahs2020
Posts: 16 Forumite

Hiya,
I’ve spent all week chatting to PayPlan via Whatsapp, and finally come to my options. Their recommendation is IVA.., but also said I can do ‘self managed payment arrangement’ but they said they don’t advise this as some creditors say no. Then there’s bankruptcy. I definitely won’t be going bankrupt, and I don’t even think IVA is right for me.
I’ve spent all week chatting to PayPlan via Whatsapp, and finally come to my options. Their recommendation is IVA.., but also said I can do ‘self managed payment arrangement’ but they said they don’t advise this as some creditors say no. Then there’s bankruptcy. I definitely won’t be going bankrupt, and I don’t even think IVA is right for me.
I owe around £10,000, which is a mixture of small credit cards, a loan and 2 store cards. I took these out when things were really tough and massively regret it. Due to being self employed and my income fluctuating so much, I am constantly paying late, missing payments, some are with debt collectors etc, and I just can’t get my head round everything being paid at different times in the month. I’ve basically lost control.
I’ve started reading stuff on here, as I as hoping to do a DMP with Payplan so I didn’t have to speak to creditors. Some are lovely, but some honestly make me panic. I’ve now read I could do this myself, but I don’t understand at what point I should try and negotiate a payment with creditors. Some are freezing interesting and letting me do reduced payments but only temporarily then it goes back to normal, and I am in a vicious circle. Does it matter who I pay any token payments to? The original creditor or the debt collector (and I find the debt collectors much easier to deal with for some reason!). Is there any advantage of waiting for a debt to be handed over to a debt collecting company as apposed to trying to keep the debt with the original creditor?
PayPlan are pushing for IVA, but with my work, I have really good months and extra money, and I honestly believe I can get this paid off. It’s just the amount of creditors I am dealing with which is causing me to lose sleep.
PayPlan are pushing for IVA, but with my work, I have really good months and extra money, and I honestly believe I can get this paid off. It’s just the amount of creditors I am dealing with which is causing me to lose sleep.
Any advice welcome.
0
Comments
-
Don`t do an IVA for a 10k debt.
IVA`s are for homeowners who owe more than 50k and can`t go bankrupt, that isn`t you.
Self managed DMP may work for you, you don`t ask approval from creditors about how much they will accept in payment, these are all unsecured, non priority debts that don`t get paid if the money won`t stretch that far, they know this, which is why they can be so vocal, ignore them, they can do nothing to you.
You wait ideally until everything defaults and debts are with collection agencies, you can then work out a budget and decide how much you want to pay to each debt, then arrange payment on each particular debt collectors website.
You tell them when they will be paid and how much, you are in control, not them.
Self management is easy peasy, there is no negotiation, and no need for stress, its simply business, you just pay what you can afford and that`s that, life goes on as normal.I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter2 -
sourcrates said:Don`t do an IVA for a 10k debt.
IVA`s are for homeowners who owe more than 50k and can`t go bankrupt, that isn`t you.
Self managed DMP may work for you, you don`t ask approval from creditors about how much they will accept in payment, these are all unsecured, non priority debts that don`t get paid if the money won`t stretch that far, they know this, which is why they can be so vocal, ignore them, they can do nothing to you.
You wait ideally until everything defaults and debts are with collection agencies, you can then work out a budget and decide how much you want to pay to each debt, then arrange payment on each particular debt collectors website.
You tell them when they will be paid and how much, you are in control, not them.
Self management is easy peasy, there is no negotiation, and no need for stress, it’s simply business, you just pay what you can afford and that`s that, life goes on as normal.Whilst I want for them to be defaulted, do I just ignore them? Or tell them that’s what I am doing? Whenever I get a default notice I panic and scrabble around to pay what they are asking then back to square 1.0 -
Do not contact any of your creditors, do not answer any phone calls or reply to any texts or E Mails.
Open any letters you receive by snail mail, file them all you have to do anything about are letters before action.
When you get a default you decide if you any afford to pay them anything, you decide the amount, you set up a standing order for the payment, you are in control not them.If you go down to the woods today you better not go alone.1 -
The absolute worst unsecured lenders can do is obtain a CCJ against you, and you repay the debt by instalments at an affordable rate, in the end that`s what all the rhetoric boils down to, most people won`t even bat an eyelid at that.
That kind of puts everything into perspective, debt collection is designed to frighten you into paying or else, well the "or else" is what`s described above, if you can live with that, then the fear has gone.
Yes, we advise you just let the collection process unfold, letters/calls etc, non payment will eventually lead to default, that`s when all interest stops, your credit file has a 6 year window until it clears again, and the debts go to collection agencies or will be sold, and are only too willing to agree to deals.
All you have to take notice of is any letters that specifically state legal action will be taken if you don`t agree a deal, that`s "will" be taken, not "may" be taken, they are know as LBA`s (letter before action) not likely you will get one, but something you should be aware of.
Oh, and don`t pay any more default notices, yes they will demand the full balance or the arrears to be paid, but that is a necessary prelude to defaulting, just let nature take its course and ignore it!!!I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter1 -
It's best to just ignore them as you want them to give up on you and default you.
It's very simple really. You work out how much you are going to pay each creditor and when, then when they have defaulted you just tell them what they will be getting. There is no need to speak to them, you can often tell them via their website or by email, or you can send them a letter if they decide to be awkward and don't provide any other way of writing.1 -
Given your fluctuating income, an IVA would be stressful as you need to make consistent payments each month.
You really do need to start a Statement of Affairs, ideally one that enables you to pay you absolutely essential costs each month. If your income doesn't cover that, it's essential that once you stop paying you debts, you put money into a budgeting fund. If you know that 4 months a year roughly you be in deficit, you need a fund that covers that eventuality.
Then you can pay the essentials and in good months buy or put aside for the costs that are more flexible like clothes, haircuts, dental care. That's also when you stash money into an emergency fund.
If you've have not made a mistake, you've made nothing2 -
Grumpelstiltskin said:Do not contact any of your creditors, do not answer any phone calls or reply to any texts or E Mails.
Open any letters you receive by snail mail, file them all you have to do anything about are letters before action.
When you get a default you decide if you any afford to pay them anything, you decide the amount, you set up a standing order for the payment, you are in control not them.When a creditor finally defaults, can that action then not be undone?0 -
sourcrates said:The absolute worst unsecured lenders can do is obtain a CCJ against you, and you repay the debt by instalments at an affordable rate, in the end that`s what all the rhetoric boils down to, most people won`t even bat an eyelid at that.
That kind of puts everything into perspective, debt collection is designed to frighten you into paying or else, well the "or else" is what`s described above, if you can live with that, then the fear has gone.
Yes, we advise you just let the collection process unfold, letters/calls etc, non payment will eventually lead to default, that`s when all interest stops, your credit file has a 6 year window until it clears again, and the debts go to collection agencies or will be sold, and are only too willing to agree to deals.
All you have to take notice of is any letters that specifically state legal action will be taken if you don`t agree a deal, that`s "will" be taken, not "may" be taken, they are know as LBA`s (letter before action) not likely you will get one, but something you should be aware of.
Oh, and don`t pay any more default notices, yes they will demand the full balance or the arrears to be paid, but that is a necessary prelude to defaulting, just let nature take its course and ignore it!!!
do debt collectors ever come round your house if you stop paying and ignore all contact?0 -
Rob5342 said:It's best to just ignore them as you want them to give up on you and default you.
It's very simple really. You work out how much you are going to pay each creditor and when, then when they have defaulted you just tell them what they will be getting. There is no need to speak to them, you can often tell them via their website or by email, or you can send them a letter if they decide to be awkward and don't provide any other way of writing.
So I could effectively decide on all the amounts I want to pay my creditors and pay them all on the same day that I chose, and ignore their own ‘payment due dates’ ?0 -
Sarahs2020 said:Rob5342 said:It's best to just ignore them as you want them to give up on you and default you.
It's very simple really. You work out how much you are going to pay each creditor and when, then when they have defaulted you just tell them what they will be getting. There is no need to speak to them, you can often tell them via their website or by email, or you can send them a letter if they decide to be awkward and don't provide any other way of writing.
So I could effectively decide on all the amounts I want to pay my creditors and pay them all on the same day that I chose, and ignore their own ‘payment due dates’ ?
If the debts default the marker disappears 6 years from that date even if the debt has not been repaid.
Look stop panicking about CCJs and debt collectors knocking at your door, a unlikely to happen and b not the end of the world. These are only unsecured debts nothing vital
The worse thing you can do is panic, nothing terrible will happen.If you go down to the woods today you better not go alone.1
Confirm your email address to Create Threads and Reply

Categories
- All Categories
- 350.2K Banking & Borrowing
- 252.8K Reduce Debt & Boost Income
- 453.1K Spending & Discounts
- 243.1K Work, Benefits & Business
- 597.5K Mortgages, Homes & Bills
- 176.5K Life & Family
- 256.1K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.6K Read-Only Boards