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DMP, maxing credit and full and final offer

ES19901990
Posts: 78 Forumite

I have been reading through all the DMP posts and I see someone asked should they max all their credit before starting their DMP so they have a large emergency fund and can make full and final offers?
Is this a route anyone takes? How early in could you make full and final offers?
If you have a little lump sum available should you offer that and monthly payments at the start after default or just save the lump sum for down the line?
Thanks all
Is this a route anyone takes? How early in could you make full and final offers?
If you have a little lump sum available should you offer that and monthly payments at the start after default or just save the lump sum for down the line?
Thanks all
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Comments
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You need an emergency fund. And to plan your start date so you have a month's wages coming in and nothing except essentials going out when you cancel your DDs.
You won't get the opportunity for full and finals for several years. Usually best to wait until they contact you in year 3 or more. So no point maxing the cards out.
You also need to make sure your SOA includes money going into an emergency fund and into a budgeting account to cover all those costs that surprise people, every Christmas for example.If you've have not made a mistake, you've made nothing1 -
RAS said:You need an emergency fund. And to plan your start date so you have a month's wages coming in and nothing except essentials going out when you cancel your DDs.
You won't get the opportunity for full and finals for several years. Usually best to wait until they contact you in year 3 or more. So no point maxing the cards out.
You also need to make sure your SOA includes money going into an emergency fund and into a budgeting account to cover all those costs that surprise people, every Christmas for example.
Thank you and if you have a little lump sum available at the start is it best to hang on to that or offer it with the monthly payment?
I.E. if you have a £5k debt but you could immediately pay down £1500 and the rest montly or just offer all monthly and hang on to £1500 for the meantime?0 -
Given how difficult it's going to be to get credit any time in the next few years, put that £1500 into the best instant access ISA you can find.
That's the basis of your emergency fund. I haven't looked as your threads, but you need money to cover transport breakdowns, domestic items popping their clogs and emergency travel if an important relative is seriously ill, or if your income takes a tumble because you are ill. So ideally, a month's essential spends and some.If you've have not made a mistake, you've made nothing1 -
Thank you that's great.0
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They max the cards out to fund the bankruptcy fee I think you may find, I don`t think that relates to DMP`s.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
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What is the best basic bank account to open before a dmp?0
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ES19901990 said:What is the best basic bank account to open before a dmp?If you go down to the woods today you better not go alone.0
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Grumpelstiltskin said:ES19901990 said:What is the best basic bank account to open before a dmp?0
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The most important thing is that it's with a bank that you don't owe money to so they can't use the right of set off. I really don't understand why they call them basic bank accounts though, surely an account is an account and if you have bad credit than they just don't give you an overdraft. I always suggest Monzo and Starling when people ask about bank accounts as they have the best apps by far. They don't call them basic accounts but I have bad credit and have opened accounts with both with no problems, I just didn't apply for an overdraft.
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