DMP and credit union

Blueblonde3

Hi all

Im just starting out my self managed DMP journey. I stopped paying for all credit 3 months ago 3 loans I credit card. I didn’t realise my one loan was a credit union? My community finance? I’ve been getting letters about it defaulting and then a formal notice. Nothing on credit file yet. Am I wrong in thinking I should deal with them differently and contact straight away? Or am I to far into the process and likely to get a CCJ. Thank you 

retiredbanker1

What do you mean exactly by 'self managed DMP'?

Have your debts been formalised in a DMP? or have you just stopped paying?

Blueblonde3

Hi yes, after reading on here, i wanted to do self mananged DMP so my in March cancelled all DRD awaiting defaults. I’ve been checking credit score and still no defaults. Today I received a letter from my community finance with formal demand. Reading i didn’t realise they are a credit union and not sure how I need to deal with them. I just thought I’d deal with them like other creditors. So just needed some advice on next steps? I’ve used the tool to look at my income and out goings. Do I contact them now or still await default. Thanks 

sourcrates

Self managed DMP`s are great, you retain all the control, and with most high street lenders, waiting for defaults before making payment arrangements, is a good strategy.

There is an "however" unfortunately, some credit unions can be difficult, and are much more likely to instigate legal action in these circumstances, than a high street lender would.

We recommend you make arrangements with credit unions without waiting for defaults, as this then negates the chances they will get legal with you.

Not all credit unions operate in this way, and the debt must default first before legal action can commence, but it has been mentioned on the DFW board a few times in the recent past that some can be difficult to deal with if you just ignore them whilst awaiting default, and will go to down that path as soon as the default has been registered.

Blueblonde3

Thank you for the reply, do you think I’m too late? I’ve had a formal demand, maybe if I contact them and set up a payment plan they have mentioned selling the debt or taking legal action would that just be a CCJ? Sorry for all the questions I’m panicking now didn’t realise that about credit unions.

Thanks 

ManyWays

A formal demand follows a set pattern, it doesnt mean they WILL do anything.
Selling the debt would be good, it means its defaulted and you can deal with the debt collector. 
How large is this debt and do you have a house with equity?

PS It may be helpful if in future you post on the Debt Free Wannabe board https://forums.moneysavingexpert.com/categories/debt-free-wannabe, the posters there have seen a lot of DIY DMPs

Blueblonde3

Hi thank you for the reply, this is for £4000 and yes my house has equity. I’ve sent an email today with DMP payments on £50 a month based on my income and expenditure. I’d rather pay this due to how they treat people. 

Thanks