Defaulted on loan

Cool_catz

Hi I'm new and looking for some advice.  I currently not working at the moment so receiving benefits and pip. I had spoke to step change and set up a token repayment plan until June. they are saying a DMP would be the best way forward. However it will take 10 years. They worked out my budget sheet and said I can only put £8 away in savings each money. Is this the right option to do. I tried to explain that over the next 10 years with the cost of food etc this extra £8 will surely not cover higher costs of living. They said that each year they would review the income/out goings. I'm currently in debt of £12,000 with 4 credit cards and a £7000 loan included in this. I have already had a defult notice on the loan but step change are still paying token £1 payments before they enter it into a DMP

realisty my income situation isn't going to improve over the next few years. Is a 10 year DMP worth it or am I better to just defult everything and just deal with being chased for these repayments further down the line.

Thank you

ManyWays

How much are Stepchange saying you can pay to a DMPa month?
Your only income is benefits? 
Are you renting or buying?

Cool_catz

£120 but they said I have to use some of my pip money to pay debt as what I use it for doesn't cover the full amount. I currently renting from the council 

Cool_catz

Sorry meant to say yes my income is from benefits as I'm not currently working

ManyWays

Do you own a car worth more then 4k, or have one on finance?
The budget you went through with Stepchange, does it include enough to take account of extra costs you have because of your disability, for example do you need a warmer house, a lot of taxis, help with the cleaning, a special diet, a need to use a gym or go swimming? How much do you have in for clothes, groceries etc? It isnt usually hard to come up with an extra £50 a month of spending so you would qualify for a Debt Relief Order. 

sourcrates

Stepchange are creditor funded, so there focus isn`t always just on your best interests, they look at the picture as a whole, and would want to get you started on a plan straight away.

They work on the actual figures you give them, so if you are just a few quid over to qualify for a debt relief order, they would not necessarily tell you this.

Best if you do a statement of affairs for us, be honest in your budgeting, and we can see if there`s a better alternative for you, look for the "stoozing link" is in my signature, click on that, and follow the instructions, then post it on this thread.