Preparing for a DMP – A Few Questions & Seeking Advice

husnu1

sourcrates said:

The problem is, if you underestimate your costs, you will end up with no money left for your essentials, and be back at square one again.

The whole idea of debt management is to pay what is affordable, and only what is affordable, that`s the only way you get out of debt, so put down exactly what you spend, if that only leaves £5 for credit repayments, then £5 is what they get, its pointless if you don`t budget correctly.

Thanks. I will go over my SOA in the next few days and make sure that everything is correctly  estimated. I will then publish it here with my total debt included to see what everyone thinks. 

husnu1

RAS said:

You got into a mess by misunderstanding your family's financial requirements. Now the time to be realistic about what they are. Put those in your SOA.

And them learn to make small savings on each category and save a decent emergency fund?

I think you are 100% right. I will be more realistic and go over my SOA again. Thanks. 

husnu1

sourcrates said:

Debt management is an informal debt solution, you call the shots not your creditors.

What you choose to spend money on is of no concern to anyone but you, only in insolvency do the creditors have a say in your budgeting, in debt management you are in charge.

You can add the expense under any heading you choose, car warranty can be mental health therapy, if you want it to be, keep in mind they have no recourse to challenge anything you spend money on at all, so your mind set has to change first off.

Creditors do not make demands of you, they will be glad to get anything back from the fictitious money they originally lent you under the fractional reserve banking scam they all operate.

Lots of us have been through this process, so we can tell you how things really work.

Sourcrates what do you mean when you say my mindset has to change first? You said the creditors won't be making any demands but I will be going through Stepchange for my DMP. Won't they be making any demands?

RAS

Insolvency solutions require you to declare all your assets, income and expenditure and to live on a strict budget. Any changes require declaration or approval.

A DMP does not require evidence of assets and asks you what you think you spend money on. No-one seriously checks what you put down, although there are some expectations. Very high costs would have to be justified.

If you choose to go with Stepchange, it'll probably take longer to repair your credit record and to pay off the debt than if you DIY. But that's your choice.

husnu1

RAS said:

Insolvency solutions require you to declare all your assets, income and expenditure and to live on a strict budget. Any changes require declaration or approval.

A DMP does not require evidence of assets and asks you what you think you spend money on. No-one seriously checks what you put down, although there are some expectations. Very high costs would have to be justified.

If you choose to go with Stepchange, it'll probably take longer to repair your credit record and to pay off the debt than if you DIY. But that's your choice.

I want to go with Stepchange because I am 61 years old and can't handle all the stress and hustle and the phone calls from the creditors. Why would it take longer with Stepchange and how hard is it to do it yourself? 

ManyWays

The argument is that going through StepChange may take longer to repair your credit record.  If aged 61 you dont much care about that and minimise stress and hassle is more important, then signing up with StepChange straight away will reduce the phone calls and letters from creditors in the early days. 

tigergambit

@husnu1 MINDSET really is everything here and when you get to our age (I'm 62) it's very hard to change it.

See my comment below:

https://forums.moneysavingexpert.com/discussion/comment/81300037#Comment_81300037

Going through Stepchange will be less stressful (I did this with Payplan) but in hindsight I would advise stopping payments and awaiting defaults first.

sourcrates

Debt management is informal, as we have already ascertained.

Going with stepchange is probably a good idea in your case, what I mean about "your mindset has to change" is that these are all non priority debts, that are just not worth worrying over, it`s of no consequence how a creditor may feel or react to this news, they won`t feel anything, as its a business decision, based on your circumstances.

They are in no position to make any demands of you, as said before, that only applies to insolvency, make sure you budget correctly, as most people underbudget and find they can`t manage after all, so make your budget a generous one, and then stepchange pay them according to your disposable income.

Once up and running, all goes quiet, and you wouldn`t know you were in a DMP.