Some advice on a DMP

DeterminedtoChange86

I have been doing more reading over the weekend. I suppose my strategy was to play a long game paying as little as I possibly could .Build up as much as I possibly could over the next year or two to have something behind me and then hope to start thinking about settlements is this naive? 

I am reading more about how I will need to pay at least 1% of the debt when the payment plans start and that would probably be about £500 a month by the time they default. I am worried they wont accept token payments. Mostly worried about the larger loan. All of my credit cards have less then 5k on them. 

sourcrates

DiamonBoy said:

I have been doing more reading over the weekend. I suppose my strategy was to play a long game paying as little as I possibly could .Build up as much as I possibly could over the next year or two to have something behind me and then hope to start thinking about settlements is this naive? 

I am reading more about how I will need to pay at least 1% of the debt when the payment plans start and that would probably be about £500 a month by the time they default. I am worried they wont accept token payments. Mostly worried about the larger loan. All of my credit cards have less then 5k on them. 

Creditors have no say in the matter whatsoever, you pay according to your available budget, there is no acceptance or non acceptance of payments, if you can`t afford it, it doesn't get paid, simple as that.

Token payments, as a long term strategy are a waste of time, short term maybe ok, but they will have no choice but to accept what you offer, if they don`t like it, all they will do is sell the debt on, or give it to a collector to manage.

You need to start thinking like a boss about this whole thing, you call the shots not them.

fatbelly

There is no 1% rule. You pay what you can.

Token payments are a short term strategy but if that links with settlement deals a year down the line that seems ok to me.

Just because you owe more to one creditor does not mean they will behave any differently

tigergambit

DeterminedtoChange86 said:

I have been doing more reading over the weekend. I suppose my strategy was to play a long game paying as little as I possibly could .Build up as much as I possibly could over the next year or two to have something behind me and then hope to start thinking about settlements is this naive? 

I am reading more about how I will need to pay at least 1% of the debt when the payment plans start and that would probably be about £500 a month by the time they default. I am worried they wont accept token payments. Mostly worried about the larger loan. All of my credit cards have less then 5k on them. 

I don't think that this is a bad strategy for a couple of years providing you have the discipline to build a fighting fund. You don't know who your debts will be allocated/sold to as yet but my experience suggests that around half of the sub 5k ones will settle for a reasonable amount if you can make a convincing argument.

You need to have a strategy worked out for the rest.

DeterminedtoChange86

I had to step away for a bit, my fears about CCJ's, charging orders, charging restrictions etc are all giving me incredible anxiety. I was on the brink of doing something very stupid as a response to crisis so I need to take a breath. 

I have (probably irrational) fears that they will not be interested in my trickle payments on such a large loan 2 or 3 years down the line and just go for a CCJ / charging restrictions setting me back years. I want to repair my credit file as soon as possible as it is likely we will want to move when this is all over.

It is quite literally killing me at the moment. 

fatbelly

fatbelly said:

Cancel d/ds, walk away from the RBS account and just use Monzo/Starling for your income and essential d/ds

Affordability complaints are a good thing to do while waiting for defaults.

https://debtcamel.co.uk/refunds-large-high-cost-loans/

And that's all you need to concentrate on.

Have you had a chat to your gp about anxiety?

DeterminedtoChange86

I reading absolutely everything, constantly. I’ve just been on the debt camel website reading about f&f offers. 

Lots of the replies said that it’s likely they won’t accept offers for large debts if they think you can afford more and have  got equity in your house, they might just go straight for a ccj / charging order.

it absolutely terrifies me the thought of working two years down the line to save for this to happen. It’s absolutely crippling me and I am completely spiralling out of control. 

fatbelly

You pay what you can afford, whether they accept it or not.

We can discuss f&f deals when your debts have defaulted and you have saved a lump sum

I can be sure that sentence you quote was not written by debt camel because she works as a debt adviser for CA and would know how things work in practice

DeterminedtoChange86

Thanks, I’m not sure anyone can’t talk me down at the moment. I’m completely gone.

Even the prospect of a CCJ further into the process is just making me absolutely sick with anxiety. It would feel brutal to think you were getting somewhere to be dealt a hammer blow like that.

RAS

A CCJ is rare, very rare, and debtor's get advanced notice of action, so may be able to stall it.

But essentially the court will look at the person's budget and devise a affordable repayment plan, likely to be very similar to what they have already been paying, maybe less. 

Given the cost of court action, that's an incentive for debt collectors to avoid CCJs.