Looking for a little guidance to start my journey towards becoming debt-free.

IRunFar

I’m so sorry to keep asking so many questions - things just keep popping into my head. 

Is there a genuine risk that my creditors will take me to court to pursue my debts?

Grumpelstiltskin

If they do and it is unlikely you will get a Letter Before Action with a form that has to be completed within 30 days. If you do get one then come back and we will tell you what to do. It is unlikely but it could happen.

sourcrates

CCJ`s, or "county court judgements" that sentence seems to instil the fear of God into people, but why is that?

I understand certain people need to keep unblemished records as far as CCJ`s go, and there is a lot of fear of the unknown, but for the vast majority of the public, all a CCJ does is stop you getting credit, and that`s it.

A judgement is only the first step in the legal process, if you don`t pay what the court has ordered, the creditor must spend more money enforcing that judgement, and only a small proportion of judgments ever get enforced, especially for consumer debt, pay what has been ordered, and they can`t touch you.

Contrary to popular belief, the legal process is done almost entirely online and by post, and all a judgement does is affirm a monthly payment to a particular creditor, payments are set according to the budget you submit to the court, so the lender can`t make you increase payments, its win win for you really, an affordable monthly payment that is legally approved.

CCJ`s vanish at the 6 year mark, the same as a default would, so no long term damage is done, I honestly can`t see why that should be anything to be feared, if anything it`s to your advantage, just think, no more creditors pestering you to pay more than you can afford, as you have a court approved payment plan.

There should be no fear about any part of the legal process.

IRunFar

Thank you @grumplestiltskins 🙏 So, yes he does get a mileage allowance, but only to a degree. He gets 0.45p per mile BUT … only between schools. He doesn’t get anything from home to his first school of the day, or from the last one to home. This means he might do, for example, 75 miles in a day, but only be reimbursed for 15 of those miles.

I am having a moderate panic that my creditors might take me to court if I stop paying. Is this likely?

sourcrates

IRunFar said:

I am having a moderate panic that my creditors might take me to court if I stop paying. Is this likely?

^^^^^^^^See my post above ^^^^^^^^

tigergambit

IRunFar said:

I’m so sorry to keep asking so many questions - things just keep popping into my head. 

Is there a genuine risk that my creditors will take me to court to pursue my debts?

Creditors will not take you to court if you stop paying - they will (eventually) default you. This is the whole point of stopping responding.

They cannot take you to court before defaulting you but they can afterwards - normally if you continue to ignore them.

But you're not going to do that, are you?

You're going to set up your DMP at that point (as each creditor defaults you they or a DMC will contact you and you will respond telling them how much you will be paying). If you're paying something there is very little point in them going through the expense of taking you to court as the court will only formalize the agreement as @sourcrates outlines above.

You have a fair way to go before then. Start building your settlement/emergency fund and enjoy the summer.

sourcrates

Just to add to the above, as there appears to be a lot of confusion about the actual process.

A creditor cannot take action to recover a debt until after it defaults.

So stopping all payments to a non defaulted debt in order to get defaults will have no come back whatsoever.

Original creditors very rarely, if ever, take legal action, they either engage a debt collector, or they wash their hands of the debt and sell it on to a 3rd party.

Legal action is usually only used by debt purchasing companies who buy these debts in bulk, and then only if ignored for a long period of time, after the usual array of standard letters.

Hope that clarifies things.

Rob5342

Regarding bank accounts, Starling is a good alternative to Monzo and has many similar features. 

Nomunnofun1

Rob5342 said:

Regarding bank accounts, Monzo and Starling are very good and have lots of good budgeting features. 

The op has three borrowings with Monzo.

Rob5342

Nomunnofun1 said:

Rob5342 said:

Regarding bank accounts, Monzo and Starling are very good and have lots of good budgeting features. 

The op has three borrowings with Monzo.

I just noticed that and edited my post.

Just to add that I had similar concerns when I started my DMP, but nothing that I was worried about happened. Four years down the line I hsve paid off a bit chunk, got some interest repayments from affordability complaints and also found that two loans are unenforceable. It really doesn't take very long to start feeling on top of things.