Debt Spiral - would love advice before the payment plan people call me in 2 hours!!!

RAS

Please stop, look and listen.

You are rushing everything. Does that explain how and why you have go into debt previously?

First off, you appear to be in Scotland. And you don't mention that in your thread title, so the people on MSE who understand Scottish debt management won't find your thread. Ask the mods to edit the title if possible.

You won't be negotiating anything with your mortgage provider. 3-6 months before your current deal ends, you can jointly peruse the options available on your provider's website and pick the one you prefer. That won't include a credit check.

Very few of us understand DAS and it's impact on your future credit record. You might be advised to speak separately to Stepchange or national debtline who have Scottish sections. Don't mention that you've spoken to Payplan, as they may not like "trespassing".

But if you can pay off your £7k debt in 18 months, do you even need a debt solution, or just to learn to budget?

What we can tell you is that in England people who rush into debt solutions often regret it. At the most basic, if you set up an immediate debt management plan, you usually damage your credit record for longer than if you waited until the debts had been defaulted. 

Rob5342

BeachBitch said:

The other issue is our joint mortgage - we are coming to the end of our fixed term with Santander and want to stay with them and renegotiate.  Will we need to do this BEFORE I enter into any debt management scheme.  PAYPLAN say that as we want to stay with the same mortgage company it will not make any difference but I can't really afford for them to be wrong on that one.  What do you think on this one?

With most lenders you can move to a new deal with no credit check so they won't even know about the the rest of your debts. I have four defaults and I moved to a new Santander fixed deal with no problems at all, it took about 5 minutes to log into my online banking and choose a new deal.

I'd echo other peoples advice and say slow down a bit, consider all your options and get some more advice on here before starting any debt solution. Payplan and Stepchange work in the creditors best interests rather than yours and can lead people into things that are far worse for them in the long term than other options.

JadedAngel88

I think, also, you are rushing into trying to find a solution. You really need to slow down before you jump in at the deep end.

Also if yourself and husband have a mortgage together and joint bank accounts of course his credit file will be affected as you have a financial connection. Please ignore the credit scores, they are not relevant in the UK.

sourcrates

A "DAS" (Debt arrangement scheme Scotland) is a regulated DMP if you like, similar to an IVA it gives you the same legal protection, but with no equity release or extra years added, it takes however long it takes to complete, and is supervised by the accountant in bankruptcy.

With only a 7k debt, I have to question whether a formal debt solution is required, if you owed 70k, I would say yes, go for it, but 7k?

You may as well just do a standard, informal DMP and save all the hassle.

MEM62

BeachBitch said:

I am personally in over £8k of debt due to a mixture of overdraft, pay pal credit, 3 credit cards!! and a loan.  

The positive thing is that is not huge.  People have successfully managed to deal with much larger amounts.  

BeachBitch said:

I have zero savings and feel really stupid and irresponsible.  

Many of us have been there.  Don't be too hard on yourself.  You are addressing it now and that is the important thing.   

BeachBitch said:

I have a Payment Plan company calling me at 4.30pm today and I know it is going to sound amazing if they say I only have to pay X and don't have to deal with creditors

Please make sure that they are not a fee-paying organisation.  You can get debt management advise for free from one of the debt charities.  

BeachBitch said:

BUT I really do not want my credit score - which is already pants - to get worse 

Firstly, you do not have a credit score.  In respect of your credit standing, why do you feel the need to protect that?  You are not going to want to be borrowing in the near future.      

ManyWays

 I will most likely go down this route due to the fact that it will only affect my credit file and not my husbands (which was a worry as it used to be done by address).  
I really hope Payplan didn't say this because what happens to your credit record DOWS affect your husband because you have a joint mortgage.
So he is probably already being affected by your missed/late payments.

The other issue is our joint mortgage - we are coming to the end of our fixed term with Santander and want to stay with them and renegotiate.  Will we need to do this BEFORE I enter into any debt management scheme.  PAYPLAN say that as we want to stay with the same mortgage company it will not make any difference but I can't really afford for them to be wrong on that one.  
Payplan are correct. If you only want a new fix, not to borrow more, then Santader have signed the Mortgage Charter ( https://www.gov.uk/government/publications/mortgage-charter/mortgage-charter) and they wont do an affordability check no matter how bad your credit record is (assuming you dont have mortgage arrears of course.)