Desperately need debt help

MissLB

I have been in contact with payplan and they have agreed I can go with a DMP. They have come up with £400 per month, I finish paying almost £200 in student loan next month so can I think comfortably pay £600. 

I am particularly concerned
about DIY would it be possible to explain to me why this is a better option? I have looked at many threads and researched as much as I can, thank you for everyone being helpful. I asked the advisor and they were adamant I’d be able to grow my credit file after 6 years, after the defaults drop off. I spoke of AP markers but they didn’t seem to think this would be an issue? Is this because they are working for the lender? They seem quite blasé about any affect on credit for any suggestion. 

I am just about to look into affordability template letters. 

Thank you

MissLB

swingaloo said:

I would take your name off that quickly.

Argh thank you, I hadn’t meant to post the last picture! I will repost without my personal details. I’m new to forums and there format 

MissLB

Statement of Affairs & Personal Balance Sheet

Summary

Monthly Budget Summary	Amount(£)
Total monthly income	3,500
Monthly expenses (incl. HP & secured loans)	2,625
Available for debt repayments	875
UNsecured debt repayments	1,699
Amount short for making debt repayments	-824

Personal Balance Sheet Summary	Amount(£)
Total Assets (things you own)	429,000
Total Secured & HP Debt	-332,000
Total Unsecured Debt	-62,050
Net Assets	34,950

Household Information

Number of adults in household	2
Number of children in household	1
Number of cars owned	2

Income, Expense, Debt & Asset Details

Income	Amount(£)
Monthly income after tax	3500
Partners monthly income	0
Benefits	0
Other income	0
Total monthly income	3500

Expenses	Amount(£)
Mortgage	750
Secured/HP loan payments	655
Rent	0
Management charge (leasehold property)	0
Council tax	125
Electricity	75
Gas	75
Oil	0
Water Rates	20
Telephone (land line)	0
Mobile phone	25
TV Licence	15
Satellite/Cable TV	60
Internet services	25
Groceries etc.	200
Clothing	100
Petrol/diesel	50
Road tax	0
Car Insurance	45
Car maintenance (including MOT)	40
Car Parking	0
Other travel	0
Childcare/nursery	100
Other child related expenses	100
Medical (prescriptions, dentists, opticians etc.)	10
Pet Insurance/Vet bills	0
Buildings Insurance	10
Contents Insurance	10
Life Assurance	10
Other Insurance	0
Presents (birthday, christmas etc.)	25
Haircuts	25
Entertainment	50
Holiday	0
Emergency Fund	25
Total monthly expenses	2625

Secured & HP Debt Description	Debt(£)	Monthly(£)	APR(%)
Mortgage	280000	(750)	4.2
Secured Debt	39000	(300)	6
Hire Purchase (HP) Debt	13000	(355)	0
Secured & HP Debt totals	332000	-	-

Unsecured Debt Description	Debt(£)	Monthly(£)	APR(%)
HALIFAX CREDIT CARD	7000	230	28
HALIFAX CREDIT CARD	1800	100	26
Lloyds credit	6000	284	29
Virgin Credit Card 2	12000	360	26
Virgin credit card 1	10000	215	0
Shop direct	500	30	0
PayPal credit	2000	50	0
Novuna loan	14000	200	0
Next	850	30	0
MBNA loan	7000	200	0
Lloyds overdraft	900	0	0
Unsecured Debt totals	62050	1699	-

Asset Description	Value (£)
Cash	0
House Value (Gross)	420000
Shares and bonds	0
Car(s)	9000
Other assets (e.g. endowments, jewellery etc)	0
Total Assets	429000

kimwp

Are those numbers definitely your half of the bills? (TV licence is the full amount)

Your clothing is high, you can cut that down to essentials only.

Do these numbers represent your actual spending (from your bank accounts) or are they just guesses?

Defaulting will give you some time to build up.an emergency fund as well as be on your credit record for less time than arrangements to pay.

Andyjflet

emergency fund is key in this plan

ManyWays

They have come up with £400 per month, I finish paying almost £200 in student loan next month so can I think comfortably pay £600. 
I suggest staying at £400 and using the "spare" £200 to build up an emergency fund faster. The lower DMP payments are at the start, the better as they are more likely to default sooner and get interest stopped sooner. 
The car HP, is that HP or PCP?
Looks like several possible affordability complaints!

Humdinger1

Others will know better but I'm not sure that going via Payplan is recommended.   There are charities that offer free advice but if I recall correctly, Payplan is a commercial company interested in maxing out fees. You can fix this - onward and upward.  Humdinger 

ManyWays

Payplan is fine for a DMP, just the same as Stepchange; they are a bit more pushy about choosing an IVA, but for a DMP it's exactly the same.

On those numbers there is no way you can manage without missed payments and defaults. So you need to face up to two things

First, your partner really needs to know. There will be some impact on their credit record because of the joint mortgage. It normally isnt huge, but its there and they may notice. And when it comes to a new fix, you will only be able to get one from your current lender and they may wonder if another lender wouldnt be cheaper. And, most important, the chance of you managing to default on and then clear this very large amount of debt without them finding out isnt good. They just have to open one of your letters by mistake.

Second you need a plan for what to do when the PCP ends. because you will not be able to get another one with defaults all over your credit record. And you may not anyway as even without defaults as you are likely to fail even the most cursory affordability check. How large is the balloon payment? Can you manage to save that amount up in 9 months? Could your partner help with that?  This is a good reason to pay as little as possible to Payplan now and to save up any spare money.

Of your lenders, Castle may turn out to be the trickiest. It looks as though you have a lot of possible affordability complaints and you should definitely go for Castle as winning that one means they are massively less likely to go to court! 

If you have cleared any debts recently with some of these loans, look at affordability complaints to them urgently, as winning one about a closed account could get you some money back to help towards the PCP balloon payment. 

enthusiasticsaver

A DMP with payplan seems a good option.  Your credit file will be affected for 6 years until the defaults drop off so they were quite wrong to  be blase about it but more lending is the last thing you should be considering anyway.  Were those loans debt consolidations and have you addressed the reasons for overspending in the first place?  Your partner should really be advised even if you do not disclose amounts or anything.  You can remortgage with your current lender but you should make clear you will not be overspending and keeping to a budget. The car if it is PCP may be a problem as you will not be able to borrow to pay off any umbrella payment or take out a new  agreement in however many years assuming it is less than 6. I would suggest you save as much as possible and buy a cheap runaround when the deal finishes. You definitely do not need to pay £100 a month for clothing although I assume that is for your children? Is your partner covering half the bills? 

tigergambit

I don't think that you should go with PayPlan just yet.

Stop paying your debtors and await defaults whilst saving as much of that money as possible towards your umbrella car payments. That should give you £2400 towards the car. Prepare a different SO A to the one you have discussed with PayPlan showing as small an excess as possible. That will allow you to save more towards the car. 

Decide what your strategy is going to be. Do you really want to pay off all that interest or are you going to aim for full &final reduced settlements?

As Manyways says make affordability complaints. Make sure you move your bank account to one unconnected to your debtors.

And speak to your partner!