So stressed! DMP & Defaults

Sarahs2020

Grumpelstiltskin said:

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. 

What’s the difference between paying a creditor my own amount before I am defaulted, as apposed to after I’ve had a default notice?

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 you start before a default you get Arrangement to Pay markers. They don't disappear until 6 years after your final payment, so you pay foy 5 years and the markers stay for a further 6 years 11 years in total.

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.

Thank you! That totally makes sense about the defaults now. Feel like I am about to start taking control. Can’t believe I was almost talked into an IVA yesterday 😩. Think I’ve seen too many of those “meet the bailiff” programmes and overthinking it all. Will start my plan on moving forward and tackling it all. Massively appreciate everyone’s advice on here.

Grumpelstiltskin

OK What you need to do is read this thread.

In Debt and Wannabe Debt Free? first Steps to take are here, please read, then ask questions. — MoneySavingExpert Forum

Stop paying all unsecured debts now. Don't contact the creditors at all at the moment.

Fill out a honest SOA and post it on here then we can see your full financial situation.

Save as much money that you would have paid to your debts for an emergency fund, something will go wrong and you will have cash to sort it out.

Set up a new basic bank account with a banking group you don't owe money to and manually transfer your wages and vital direct debits to that account, set up a savings account for your emergency fund.

Don't even look at any texts or E Mails you can totally ignore them but do open anything you get by snail mail.

Most importantly keep posting on here with any queries you have, we will help you.

Sarahs2020

Grumpelstiltskin said:

OK What you need to do is read this thread.

In Debt and Wannabe Debt Free? first Steps to take are here, please read, then ask questions. — MoneySavingExpert Forum

Stop paying all unsecured debts now. Don't contact the creditors at all at the moment.

Fill out a honest SOA and post it on here then we can see your full financial situation.

Save as much money that you would have paid to your debts for an emergency fund, something will go wrong and you will have cash to sort it out.

Set up a new basic bank account with a banking group you don't owe money to and manually transfer your wages and vital direct debits to that account, set up a savings account for your emergency fund.

Don't even look at any texts or E Mails you can totally ignore them but do open anything you get by snail mail.

Most importantly keep posting on here with any queries you have, we will help you.

Thank you so much, taking a read now and will start putting things in place. Already opened op a Monzo account a few weeks ago which has never been used, so might make that my new basic bank account. 

Will tackle SOA. I find this part so hard as I am self-employed, my income can vary greatly. My husband has all the priority bills in his name and he pays them all. I pay for the children’s things and most of the food and other essentials. Also my business priorities. We’ve always done it this way as my income is so inconsistent. So on a SOA, it will look like I don’t have an priority expenses.

sourcrates

Sarahs2020 said:

What’s the difference between paying a creditor my own amount before I am defaulted, as apposed to after I’ve had a default notice?

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’ ?

Until a debt defaults, you are still in a contractual relationship with the lender, paying interest, and payment of a certain amount, on a certain date, usually monthly.

Once a default is issued, your contract ends, there is no longer a requirement on you to pay any interest, or a contractual amount by a certain date, as you are no longer under contract.

Your formal agreement will have ended, so now you can choose to pay what you want, when you want, there will no longer be any "payment due dates".

Sure whoever picks up the debt will want regular monthly payments, and that`s what you will likely end up doing, but its by consent, your consent, not by contract, big difference.

RAS

One of the things you really need to do is to separate your business and personal accounts. 

For one thing, you need to do that to sort out your tax returns. And if you are paying for stuff for your business from your personal accounts, you may actually be removed from making a loss on the business but not realise it.

You then take as income some of the profit from the business, rather than flipping between panicking about how you are going to fund both your family and your business.