DMP help please

Fluffy_Mittens_6

So I’m applying for a DMP through PayPlan. 

I live with my parents and I’m worried about them finding out. Will the creditors send letters to the house? 

Will anyone turn up at the house? 

I can’t sleep at night where I am so worried about this but I can’t keep up with my repayments. 

They have told me to stop paying everything. I’m now panicking and worrying 

Grumpelstiltskin

So you are stopping paying your debts and waiting for them to default?

You need to do this before you start repayments.

Yes the creditors will write to you and phone, text and E Mail you.

Don't you think you should be fair to your parents and tell them what is happening?

Fluffy_Mittens_6

They have told me to stop paying now and the payment plan will be set up in 2-3 weeks, they said payments won’t default for 3-6 months approx. 

I would love to tell my parents but unfortunately they would worry about me and I’m worried about putting stress on them 

Grumpelstiltskin

You do realize that if you start your DMP before  your debts have defaulted your credit report will be marked with 'Arrangement to Pay'?

This means they will stay on your credit report for 6 years after your last payment, so if it takes 4 years they will stay for 10 years from now.

If they default before you start repaying they disappear 6 years from the date of default even if you haven't finished repaying them.

It doesn't pay to rush into a DMP too soon.

Fluffy_Mittens_6

I didn’t know this. Thank you for the info. 

So I need to ask them to wait to start the plan? 

Do you know how many letters they normally send out to you? How long do I wait until I set up the plan? 

I was going to set up the plan now because I’m worried about the letters and people turning up 

thank you for taking time to reply. 

Grumpelstiltskin

The debt charities won't tell you this.

How many letters? Who knows.

How much is your total debt and how many creditors do you have?

Fluffy_Mittens_6

Appreciate the info, finding this a very hard time! 

21 creditors, 41K 

Grumpelstiltskin

Well there will be more than one letter from each creditor.

I think you need to step back and find a way to tell your parents, do they know how you got into debt?

Fluffy_Mittens_6

I’m thinking an IVA maybe better as people say you don’t get the letters as they’re not allowed to contact. 

My parents knew I was in debt but think I’ve sorted it. I feel it would put a lot on stress on them and this is my problem to fix 

EssexHebridean

Do you think your parents will find it more stressful to find out about your financial struggles by you sitting them down with a cup of tea and a plan in front of you to sort things out, and reassurances that you have everything under control, or by finding out by accident, perhaps at a time you are there to ask questions about it? 

The worry if debt is generally pretty extreme - and whether you are aware of it or not, it is almost certainly affecting your demeanour. Maybe your parents are currently fretting that you are ill - informed which case that your issues are just money related will just come as an almighty relief! 

You live in the same house, one way or another they are going to find out - and it would be better by far that they found out directly from you, in a controlled situation. 

As for the debt solution, you need to stop and take a breath and not rush into anything. An IVA may well not be suitable for you - what assets do you have which need protecting, for a start? 

A good starting point is to put together your SOA (statement of affairs) - the link to the calculator for this is in my signature. Complete it openly and honestly, use the “format for MSE” option then copy and paste in here and we can take a look and help you come up with a plan.

fatbelly

I think you need to take a step back. Post a soa and take some time to plan your route out of this. Jumping into a dmp has problems, jumping into an IVA has more.

Stop the debt payments, save a lump sum, get your banking sorted out to somewhere you don't have debts.