StepChange v Self-Managed... £85k+ Debt

Grumpelstiltskin

What you must realize some of the Jones you are trying to keep up with are in an equally bad or may be even worse position than you are but they haven't admitted it yet.

You have admitted it so at least you are in front of them.

Avante_2

Avante_2 said:

ManyWays said:

How large are your partner's debts in their DMP, who is the DMP with, how much are they paying a month and how long has this been running? 

Insolvency for them could be a better option, so they can cover more of their fair share of costs when they are back at work, letting you clear yours faster

She entered DMP with StepChange 2 years ago debts of c.£20k. This has been on hold/reduced whilst on maternity.

In reality, she could ask family and they would clear the debt altogether, but I think it's good she repays it as it may change her attitude toward debt in the future.

I agree with what has been said above, we both need a serious discussion regarding spending and keeping up appearances.

When she returns to full time employment, it will ease financial pressure on me as she will contribute to food/household bills.

In hindsight, I should have entered into it with her as a joint DMP, however at the time I was in a regulated role which required credit checking twice a year so would have put my employment at risk, I struggled on and now here we are... in a new role where I am not credit screened, however the debt is even worse

Grumpelstiltskin

If I were your partner I would cancel my DMP with Stepchange and pay nothing to any creditor, then by the time she is back at work see what and who have come out of the woodwork and see if she could get reduced settlement figures. Nothing will happen quickly and it would give her time to save a little.

sourcrates

We see it all the time on these boards, good incomes, but indebt up to the hilt, just so they can have that "new car on PCP", or that "holiday of a lifetime" daily trips to Starbucks, or whatever it may be, we have all been guilty of it.

Lots of people in this country today are living literally one payday away from financial meltdown, so you are by no means alone in this, its simply that the British stiff upper lip gets in the way of talking about our finances, we see it as a "taboo" subject, and it should not be like that.

Personally I think a "self managed DMP" will give you the most freedom, you can dictate how your budget is allocated, in a way that`s best for you, not your creditors.

If any ask for a copy of your budget, just show them something that backs up the position you want them to see.

Creditors only have rights if you are both subject to an insolvency solution, outside of that, they have none, so you can deal with them as you see fit.

Avante_2

sourcrates said:

We see it all the time on these boards, good incomes, but indebt up to the hilt, just so they can have that "new car on PCP", or that "holiday of a lifetime" daily trips to Starbucks, or whatever it may be, we have all been guilty of it.

Lots of people in this country today are living literally one payday away from financial meltdown, so you are by no means alone in this, its simply that the British stiff upper lip gets in the way of talking about our finances, we see it as a "taboo" subject, and it should not be like that.

Personally I think a "self managed DMP" will give you the most freedom, you can dictate how your budget is allocated, in a way that`s best for you, not your creditors.

If any ask for a copy of your budget, just show them something that backs up the position you want them to see.

Creditors only have rights if you are both subject to an insolvency solution, outside of that, they have none, so you can deal with them as you see fit.

This is the problem, friends get new car, we need new car, friends go on holiday, we need a holiday. I have struggled to say no because "You have a good job" - well yes but I have no savings lol... It is not sustainable and we have been lying to ourselves trying to keep up appearances. Now that I have a baby I want to get out of this vicious cycle of debt!

My revised plan is as follows:

1) All Direct Debits have been cancelled in October, I am currently 1 month in arrears with 17 unsecured creditors.
2) Funds that would have serviced debt are being saved in an Emergency Fund.
3) I will use the emergency fund to clear arrears on the x2 Credit Union loans and maintain monthly payment going forward (to avoid CCJ).
4) The other 15 creditors can default me, I will offer pro rated payments and hope further down the line they will offer reduced settlement. By this point, I should have built up funds to offer settlements and may have had salary increases/bonuses too.

I have done a revised SOA which when paying Credit Union x2 full payments leaves me with c.£480pm to service the 15 creditors once defaulted.

Have I missed anything obvious?

Avante_2

Grumpelstiltskin said:

If I were your partner I would cancel my DMP with Stepchange and pay nothing to any creditor, then by the time she is back at work see what and who have come out of the woodwork and see if she could get reduced settlement figures. Nothing will happen quickly and it would give her time to save a little.

I had not thought about this, I am going to discuss with her tonight. She could go fully insolvent and have no employment impact too. If she did, she could help with the household costs and I could clear debts faster.

 Thanks so much for suggesting I look further into this.

Avante_2

Update: 10/11/25 - 

Arrears of £170.68 & £387.95 paid off the x2 Credit Union loans. Full payment will be maintained going forward.

I used "emergency funds" to do this, I had not realised that Credit Unions are more likely to default and go straight to CCJ.

I hope the experts will agree this is a sensible approach?

All the other debts can default and I will deal with each one at the time.

fatbelly

Your plans sound good. I suspect Stepchange might struggle to understand why you are prioritising the credit union but I can see the logic of that

Avante_2

fatbelly said:

Your plans sound good. I suspect Stepchange might struggle to understand why you are prioritising the credit union but I can see the logic of that

I agree and the reason I want to self manage rather than StepChange, is that I can deal with the creditors/payments myself.

Approaching StepChange was a good process for me as it put everything in black and white, but now I have read a lot of detail on the forums, I think self-managed is the best way to go for me anyway

Avante_2

StepChange are currently waiting for me to set up my DD to them... I am in breathing space until 14/12/25.

Now that I want to self-manage, should I:
a) Ignore them and let them close my DMP application and allow breathing space to run it's course
or
b) Email them and explain I do not want to pursue DMP via them and to remove me from breathing space? (so default process is expedited)
or 
c) ?

In the grand scheme of things... another c.2 months breathing space will allow to me build up a fund, but defaults are going to take some time too so either way I get the same outcome?