DMP advice for newbie. Please help

katsu

You say Sky "isn't that high".  If you read the main site MSE articles you'll see good Internet deals. 

The point is that all these savings add up.

Let's say you get it from £80 to £40 if you cancel Sky TV stuff and get fibre broadband from someone. That's £480 a year off a debt/ not being over-spent.

You've got mobile data each with Lebara plus £45 to sky mobile plus the over £80 on the TV and Internet (then plus the TV Licence and £12 for Amazon Prime)... That's nearly £2k a year and definitely feels like you can make savings. 

The budget you suggested says that on your lowest income month's you don't have enough money coming in to meet all your current expenses and pay £150 to your credit cards so it seems like you need to make savings so you can meet your costs more comfortably? 

I suggest you discuss with your partner what if you cut some of these expenses or pay them from this 100 spending money you each have?

It's hard now but it will all get easier. 

Good luck to you in making the changes. You can do it! 

moogle87

[Deleted User] said:

So what about the large groceries bill? At the moment you have just batted back at the suggestions made by posters offering ideas to help you cut costs. If you are not prepared to cut back to reduce costs and pay off debt the only other alternative is to increase income. 

I think this is overly harsh.
I haven't commented on the groceries bill. 
What I have done, is to provide additional clarification on some of the suggestions. I also added extra comments to my original SOA for future readers can see this.
E.g. The Sky bill can't be reduced as we are a) locked in to our current deal & b) that also includes our broadband as well.
I can't reduce the supplements cost because it's prescription cannabis. 

moogle87

Grumpelstiltskin said:

OK So you think you will claim PIP.

Problem with this is  a) It is complicated to claim and difficult to be awarded.

b) even if you do manage to jump through the hoops it takes many months to be paid, OK you would get arrears paid but if you think nothing will actually be in your hands for 1 year it doesn't solve your immediate problems.

Go across to the Benefits board on here and ask their advice about PIP.

I think you are fixed in your way of life and can't see any other way but you will have to rethink.

I know how difficult it is to get PIP (which is why I haven't claimed it so far) but seeing as I have to spend £200 a month on a prescription product that the NHS doesn't cover & my disability affects my ability to work (I can't manage full time hours), I need to try. Also part of the reason why we are in so much debt is because I had to leave my career & retrain in something else that I would be able to manage. I am entitled to this money, it's literally what PIP is designed for, so I have to try.

I'm not fixed in our way of life, I know things need to change, but most of the costs we currently have are fixed & I can't do much about them. The only area we could really save, is on our groceries bill.

moogle87

katsu said:

You say Sky "isn't that high".  If you read the main site MSE articles you'll see good Internet deals. 

The point is that all these savings add up.

Let's say you get it from £80 to £40 if you cancel Sky TV stuff and get fibre broadband from someone. That's £480 a year off a debt/ not being over-spent.

You've got mobile data each with Lebara plus £45 to sky mobile plus the over £80 on the TV and Internet (then plus the TV Licence and £12 for Amazon Prime)... That's nearly £2k a year and definitely feels like you can make savings. 

The budget you suggested says that on your lowest income month's you don't have enough money coming in to meet all your current expenses and pay £150 to your credit cards so it seems like you need to make savings so you can meet your costs more comfortably? 

I suggest you discuss with your partner what if you cut some of these expenses or pay them from this 100 spending money you each have?

It's hard now but it will all get easier. 

Good luck to you in making the changes. You can do it! 

Having gone through our budget, I actually put his wages down as too low, so we actually have another £200 a month. 
We've also agreed that we need to be better with spending on food in particular (no more takeaways & eating out limited to special occasions or the very occasional cheap meal out with friends) 
I've also gone through it with a debt advisor from National Debt Line & at the moment we have about £250 a month spare after we've set aside money for things like savings, maintenance etc. The advisor said that our budget sounds about right.

moogle87

Update:
We've had some debt advice from National Debtline & they've suggested the following:

1) Move joint bank account from Barclays to somebody that we don't owe anything to.
2) Send holding letters to all creditors.
3) We may be able to raise some capital, so explore full & final offers. I need to do some more research on this to see what lenders tend to accept. E.g. would a 45/50% offer be accepted (I'll go in offering less, but I think we may be able to raise about £18k0?
4) If unsuccessful, go down the DMP route. Atm it would take about 14 years to clear, so we need to find a charity who would either be willing to do this for us for free or do it ourselves.

They advised against an IVA as he said that it would be hard to justify when we have so much much equity in our home.

If anybody has any advice on charities who would do a DMP for free over 14 years & what lenders tend to accept as a full & final offer, that would be appreciated. 

moogle87

Hi all,

I have created another post but felt like it might be helpful to start a new one about full & final offers.

We currently owe £41k to the following:

Barclays: £8710
Tesco card 1: £3726
Tesco card 2: £8356
MBNA: £6156
Santander: £2932
M&S: £2443
Virgin: £7246
PayPal: £1852

So far, we have no defaults but the Barclaycard will default once we miss the next payment, as this will be the 3rd missed payment.

After some advice, I'm going to change our main bank account to First Direct who we don't owe anything to.

We've been advised by National Debtline to explore full & final settlement offers because we may be able to raise £18k - £20k.

But is 45/50% a figure that is usually accepted?

I don't want to get our hopes up that they might accept this if they won't.

If they don't, we will go down the DMP route.

Gandalf644

moogle87 said:

Hi all,

I have created another post but felt like it might be helpful to start a new one about full & final offers.

We currently owe £41k to the following:

Barclays: £8710
Tesco card 1: £3726
Tesco card 2: £8356
MBNA: £6156
Santander: £2932
M&S: £2443
Virgin: £7246
PayPal: £1852


After some advice, I'm going to change our main bank account to First Direct who we don't owe anything to.

Just be aware that your M&S credit card is is joint venture between M&S Financial Services and HSBC. 

First Direct, who you are changing your bank account to is also owned by HSBC. 

I am not 100% sure if there is a right of offset between M&S Credit Cards and First Direct with both being part of HSBC Group, but it maybe worth changing your current account to a bank totally unconnected to any of your listed debts, i.e. Natwest, Nationwide, Co-op Bank etc. 

Was also going to suggest the TSB but Santander are in the process of purchasing them. 

Also do not use the Switching Service to change bank accounts. Set up your wanted DD's etc manually after opening your new account. 

Rob5342

50% is a common sort of level that people are sometimes able to settle at. Normally settlement offers are reached with debt collectors after they have had the debt for a while original creditors aren't normally willing to settle.

How are you planning to raise the money? If you can raise it easily then a DMP may not be the right choice, if you have to borrow it from somewhere else then shifting debt around is a bad idea. 

Rob5342

50% is a common sort of level that people are sometimes able to settle at. Normally settlement offers are reached with debt collectors after they have had the debt for a while original creditors aren't normally willing to settle.

How are you planning to raise the money? If you can raise it easily then a DMP may not be the right choice, if you have to borrow it from somewhere else then shifting debt around is a bad idea. 

Grumpelstiltskin

OK Do not risk a bank account with First Direct,  you really need separate accounts, not a joint one and an account with no overdraft. Check before you open it that it doesn't have a connection with any of the banking groups you owe money to, as Gandalf pointed out it isn't sometimes obvious which are connected.