Questions on DMP

debtmumof4

Hi Everyone!!

This is all new to me and my husband, we know nothing about DMP apart from what we've read only.

our situation is ;

 .90k in debt- loans and credit cards - (no car payments or anything)
. 4 young children - 8yrs and under. 
. husband self employed
. I am employed and  I clear £900 pm . 
. we own our home- mortgaged

I am very worried and anxious all of the time, I feel like we just need to get in DMP asap, but because we don't know much about it, that is also worrying me.

my worries are ..


1. The debt is that big, would it be possible to pay this over a 10yr - 15 yr plan? - ideally 15yrs but I know that's a lot to ask. 

2. If we can do such a long payment plan, would this be on our credit files for 6 year AFTER the last payment?

3. I have read on the forums about letting the cards/ loans go into Default. would this mean our credit file would only be affected for 6 yrs? or is it just possibility. (we hope its off our credit file in 6yrs?)

4. bailiffs / court orders. what are the chances? if were in a payment plan we are still essential paying so do we not worry about this?  ... what about when we are letting the accounts go into default ?

5. obviously, 90k worth of debt, we have heavily relied on credit cards for everyday life, the fear of loosing the security is scary, especially with husband being self employed. 

6. If one year my husband earns more, (or myself) would we be expected to increase the monthly payments? We feel like we would like to know where we stand for the whole plan and stick with that. 

7. Is self management better? email all the companies explaining we can pay this much, please freeze interest etc, or is it best to go through the likes of step change?. I haven't rang them yet, I'm too embarrassed to say 90k of debt. 

8. Anything else we haven't thought about? 

debtmumof4

ONE MORE THIS TO ASK...

9. either through step change or self management, what do the credit card companies / loans (even step change) ask to see? do they want statements, tax overviews? payslips? 

debtmumof4

sorry, one more. 

10. would the DMP being a joint plan? or would we go down this road as two individual plans, our credit card and loans and single names, none are joint. 

Grumpelstiltskin

OK As your husband is self employed he will need to contact Business Debt Line.  Contact us | Business Debtline | Business Debtline

You will need to separate out business debts from personal debts.

Is his self employment viable?

debtmumof4

none of the debt is business, all personal. would he still need to contact business debt line?

yes his self employment is viable 

Grumpelstiltskin

Stepchange are not happy with self employed.

You could self manage but the problem is the large amount, how did it get so high?

debtmumof4

just from surviving on one income ( I have been with the kids at home for many many years)

so would you say that self manage may not be an option too? what would you advise? 

Grumpelstiltskin

No, self management is always an option.

Have you read this thread?

In Debt and Wannabe Debt Free? first Steps to take are here, please read, then ask questions. — MoneySavingExpert Forum

Can you complete a honest SOA and post it on here making sure you post the interest rates on the debts.

When we see the full picture we can give you the best advice.

ManyWays

A SOA is the best start, could you list Mine/His/Joint against the debts and put the lender name in, not just credit card 1.

gwynlas

The more information you can give on your SOA the better the responses you are likely to get here.

Are all debts and assets in both your names?

It is possible for dmps to run as long as 20 years, my partners through SC  does, but this assumes that payments are not increased as your situation improves.

It is essential that you can genuingly afford your committments as otherwise you are likely to default on payments.

Yes any arrangements to pay will impact on your credit rating