DMP Where to go from here

TheMiscGuy596

Hi MSE forum

Hope you are all OK.

I am just looking for some advice. I have spoken to StepChange as I have accumulated a large amount of debt. The majority of this is mobile phone debt where I have bought phones to sell to offset my debt.

StepChange have advised that the first things I should do are to continue with payments to everyone but get the contracts cancelled. 

I am a local government worker and I have a lot of income which goes to non priority debts. A lot of my income goes out to paying off these debtors. I don't pay a lot of bills as I work from home 5 days a week and I also have parents who cover most expenses. Just occasional travelling once a month to office. I usually walk elsewhere.

I am just wondering, as advice on this forum seems to conflict StepChange, what my best course of action is.

I am not bothered about keeping any of the numbers for my contracts but my concern is that if I continue paying these as StepChange have advised me to in a DMP, there is hardly anything going to my other debtors. So it will take longer and I am paying off phones I do not need.

Am I best to just move all money to Nationwide whom I have no debts with and let everything default? If so when they default do I then set up the payment plan with StepChange? 

Any advice is much obliged.

SOA.
[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

Household Information[/b]

Number of adults in household........... 3

Number of children in household......... 1

Number of cars owned.................... 0[b]

Monthly Income Details[/b]

Monthly income after tax................ 1950

Partners monthly income after tax....... 0

Benefits................................ 405

Other income............................ 0[b]

Total monthly income.................... 2355[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 0

Secured/HP loan repayments.............. 0

Rent.................................... 0

Management charge (leasehold property).. 0

Council tax............................. 0

Electricity............................. 0

Gas..................................... 0

Oil..................................... 0

Water rates............................. 0

Telephone (land line)................... 0

Mobile phone............................ 47

TV Licence.............................. 0

Satellite/Cable TV...................... 0

Internet Services....................... 0

Groceries etc. ......................... 175

Clothing................................ 40

Petrol/diesel........................... 0

Road tax................................ 0

Car Insurance........................... 0

Car maintenance (including MOT)......... 0

Car parking............................. 0

Other travel............................ 15

Childcare/nursery....................... 0

Other child related expenses............ 0

Medical (prescriptions, dentist etc).... 20

Pet insurance/vet bills................. 20

Buildings insurance..................... 0

Contents insurance...................... 0

Life assurance ......................... 0

Other insurance......................... 0

Presents (birthday, christmas etc)...... 30

Haircuts................................ 7

Entertainment........................... 30

Holiday................................. 0

Emergency fund.......................... 50[b]

Total monthly expenses.................. 434[/b]

[b]

Assets[/b]

Cash.................................... 0

House value (Gross)..................... 0

Shares and bonds........................ 0

Car(s).................................. 0

Other assets............................ 0[b]

Total Assets............................ 0[/b]

[b]

No Secured nor Hire Purchase Debts[/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR

O2.............................5500......350.......0

Tesco Mobile...................4000......205.......0

Vodafone ......................1400......105.......0

Creation.......................1470......60........45

Drafty.........................570.......60........100

Zopa...........................1498......60........30

PayPal.........................2980......300.......12

HSBC...........................5000......100.......20

Halifax........................5470......180.......20

Tesco Bank.....................2700......60........17

Marbles........................2500......150.......40

Fluid..........................5500......250.......40

Natwest Credit Card............1700......50........30

Natwest Credit Card............5000......75........16

Natwest Overdraft .............2700......80........40

Lloyds.........................7000......180.......20

ID Mobile......................2600......200.......0[b]

Total unsecured debts..........57588.....2465......- [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 2,355

Expenses (including HP & secured debts). 434

Available for debt repayments........... 1,921

Monthly UNsecured debt repayments....... 2,465[b]

Amount short for making debt repayments. -544[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 0

Total HP & Secured debt................. -0

Total Unsecured debt.................... -57,588[b]

Net Assets.............................. -57,588[/b]

[i]Created using the SOA calculator at www.stoozing.com. 

Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]

Thanks

sammyjammy

Do you live with your parents?  If you pay for virtually nothing where has the debt come from?

fatbelly

Are you living with parents? You have put zero for a lot of things that normally have high values. If so, do you pay anything for your keep?

I cannot see a reason to prioritise your mobile phones, except the one you are keeping.

Move all your income and essential expenditure to Nationwide.

You cannot afford the contractual payments on 57k of debt so stop paying and let the dust settle.

The mobile phone contracts will add their fees, then terminate and pass them on.

If some of those are overdrafts you may have to encourage them to close the accounts. 

Longer term, a dmp may be suitable

TheMiscGuy596

sammyjammy said:

Do you live with your parents?  If you pay for virtually nothing where has the debt come from?

Yes with parents. Debt has come from gambling mainly.

TheMiscGuy596

Have self excluded from gambling online via Gamstop and have stopped for over 6 months now but obviously not getting anywhere with paying everything off.

TheMiscGuy596

fatbelly said:

Are you living with parents? You have put zero for a lot of things that normally have high values. If so, do you pay anything for your keep?

I cannot see a reason to prioritise your mobile phones, except the one you are keeping.

Move all your income and essential expenditure to Nationwide.

You cannot afford the contractual payments on 57k of debt so stop paying and let the dust settle.

The mobile phone contracts will add their fees, then terminate and pass them on.

If some of those are overdrafts you may have to encourage them to close the accounts. 

Longer term, a dmp may be suitable

Sorry missed this post - phone didn't load it for some bizarre reason.

Yep with parents. They get good money so no I don't pay towards keep.

I think this sounds like the best advice- so just so I've got this right, let it all default until the "dust has settled" then when the debt collection letters start coming through, get on the phone to StepChange to get a plan in place?

sammyjammy

Yes thats the general advise, unless you want to self manage it.  Make sure to use the money thats not going on the debts to build yourself an emergency saving fund.

Still a bit confused by your SOA, do you have a child?

TheMiscGuy596

sammyjammy said:

Yes thats the general advise, unless you want to self manage it.  Make sure to use the money thats not going on the debts to build yourself an emergency saving fund.

Still a bit confused by your SOA, do you have a child?

No sorry shouldve said as well this is my brother who is technically a child but I don't pay towards expenses etc.

Thank you both you've been helpful 😊 

Rob5342

I would suggest that you manage it yourself rather than use Stepchange, it's very easy to do. Stepchange just make the whole thing more complicated as they try and get the maximum possible amount paid to creditors. if you manage it t yourself you can act in your own interests only. 

fatbelly

Some people use stepchange and then switch to self managed.

In your case you need to focus on getting debt free and keeping away from gambling. If you put your effort into the different strategies of dealing with debt, that could give you something to focus on: affordability complaints, cca requests, full & final settlements, alongside an affordable dmp.

When it comes to giving your creditors a financial statement I think you should put something in for rent/keep. Even if in practice you save that into an emergency/fighting fund. Maybe £100 per week.

TheMiscGuy596

Rob5342 said:

I would suggest that you manage it yourself rather than use Stepchange, it's very easy to do. Stepchange just make the whole thing more complicated as they try and get the maximum possible amount paid to creditors. if you manage it t yourself you can act in your own interests only. 

Thanks - what's the best way to do it myself? Wait until the letters come then deal with debt companies individually?

fatbelly said:

Some people use stepchange and then switch to self managed.

In your case you need to focus on getting debt free and keeping away from gambling. If you put your effort into the different strategies of dealing with debt, that could give you something to focus on: affordability complaints, cca requests, full & final settlements, alongside an affordable dmp.

When it comes to giving your creditors a financial statement I think you should put something in for rent/keep. Even if in practice you save that into an emergency/fighting fund. Maybe £100 per week.

Yeah of course - thank you.