DMP advise

Sillymum93

Hi

I have recently come out of a 10 year relationship and managed to get my debts down quite significantly but I am struggling as a single mother of two to do the final 15 grand totalling interest etc

I am thinking a DMP is best route.

I have

1 x large loan £13,500

2 x payday loans £1000

3 x credit cards £1550

I havent defaulted anything yet

Why do people say change banks? I don't want to I've been with my nationwide bank since I was 16

Please help in simple terms

Thanks in advance

Grumpelstiltskin

People change banks as they need an account that doesn't have an overdraft. This needs to be with a banking group you don't owe any money to.

Have you read this thread?

In Debt and Wannabe Debt Free? first Steps to take are here, please read, then ask questions. — MoneySavingExpert Forum don't rush into a DMP until you are 200% happy you are doing the right thing if you can't afford to pay the unsecured debts then stop paying them and save as much as you can into an Emergency Fund.

Once we have seen your SOA we can give you the best advice.

13thlegion

If your loan and none of your credit cards are with Nationwide or another part of the same group (Virgin Money, Yorkshire Bank, and Clydesdale Bank) then there is no need to open a new bank account.

If they are, you don't need to close your Nationwide account, just open a new one for day to day use and leave the Nationwide one empty.

If you do open a new bank account do not use the switch service, but manually change over things that you need to (not the direct debits for the debts - just cancel them).

Sillymum93

https://forums.moneysavingexpert.com/discussion/comment/81994335#Comment_81994335

[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

Household Information[/b]
Number of adults in household........... 1
Number of children in household......... 2
Number of cars owned.................... 1[b]

Monthly Income Details[/b]
Monthly income after tax................ 1824
Partners monthly income after tax....... 0
Benefits................................ 2478
Other income............................ 360[b]
Total monthly income.................... 4662[/b][b]

Monthly Expense Details[/b]
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 1250
Management charge (leasehold property).. 0
Council tax............................. 136
Electricity............................. 45
Gas..................................... 44
Oil..................................... 0
Water rates............................. 90
Telephone (land line)................... 15
Mobile phone............................ 25
TV Licence.............................. 0
Satellite/Cable TV...................... 48
Internet Services....................... 38
Groceries etc. ......................... 520
Clothing................................ 30
Petrol/diesel........................... 260
Road tax................................ 17.18
Car Insurance........................... 144
Car maintenance (including MOT)......... 25
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 1400
Other child related expenses............ 60
Medical (prescriptions, dentist etc).... 15
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 5
Entertainment........................... 30
Holiday................................. 0
Emergency fund.......................... 50[b]
Total monthly expenses.................. 4267.18[/b]
[b]

Assets[/b]
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0[b]
Total Assets............................ 0[/b]
[b]
No Secured nor Hire Purchase Debts[/b]

[b]Unsecured Debts[/b]
Description....................Debt......Monthly...APR
Aqua...........................340.......15........0
118 118........................1000......25........0
118 118 loan ..................12318.2...224.5.....0
Quid market....................400.......0.........0
Mr lender......................287.4.....0.........0
Zopa...........................250.......15........0[b]
Total unsecured debts..........14595.6...279.5.....- [/b]

[b]
Monthly Budget Summary[/b]
Total monthly income.................... 4,662
Expenses (including HP & secured debts). 4,267.18
Available for debt repayments........... 394.82
Monthly UNsecured debt repayments....... 279.5[b]
Amount left after debt repayments....... 115.32[/b]

[b]Personal Balance Sheet Summary[/b]
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -14,595.6[b]
Net Assets.............................. -14,595.6[/b]

[i]Created using the SOA calculator at www.LemonFool.co.uk.
Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]

Rob5342

Banks have a right of set off which means that if you owe them money they can take money from other accounts you hold with them or with the same banking group to cover it. None of the debts you list have anything to do with Nationwide so any money you have with them can't be touched.

Smudgeismydog

Firstly, well done for already getting your debts down, and then coming here to get help with this next phase.

Comments on your SOA;

• are all your debts 0%?
• you note you are putting £50pm into an emergency fund, but have nothing saved. An emergency fund is crucial, as life happens and having some funds available can stop you resorting to taking on more debt
• your water bill at £90pm seems high, are you on a meter?
• satellite/cable and internet at £86pm is high, what does this include? Are you paying for services you could cut back on?
• you don’t seem to have any contents insurance, how would you replace items if something happened?
• nursery fees are so expensive! How much longer have you got left as this will make a real difference to your finances once they are both in school? it might just be that things remain tight for a while, but there will be light at the end of the tunnel (I can sympathise as I remember it well)
• your car running costs also stand out, particularly fuel and insurance. Was your loan for the car?

ManyWays

That 118 loan will have been expensive and two payday loans. How have you managed to get other debts down a lot?

How old are your children?

Sillymum93

https://forums.moneysavingexpert.com/discussion/comment/81995236#Comment_81995236

I can't find the apr but 118 loan is 37%

I haven't started the 50 emergency fund yet

£90 is because I couldn't pay my bill so they split over the next 6 months on top of normal monthly DD

TV/SUBSCRIPTION/CABLE I could cut back but I do pay for kids channels etc and Disney through sky for the children

I pay something for my fridge, tv, dishwasher and washing machine but it's around £15 a month

Yup I have one daughter who goes 8-6pm Monday to Friday and my other daughter goes to BF club and then she goes to a childminder for 3 hours after school

I have to drop my children half way to their dads every other weekend which is a 2-3 hr drive so fuel is high

My car insurance is due to renew next month and that with breakdown should go down to around £90 a month

Sillymum93

4 and 6

I had over 25k debt. I work 8:30-5pm monday-friday to get it down as much as I can and now I'm struggling

I feel like I blink and I have no money

ManyWays

are you making any payments to the payday loans?

Is £30 a month for clothes just for you, or the children as well?

The car maintenance amount looks too low to be safe.
Presents and haircuts looks low.
You need some more money in for entertainment or holidays

Sillymum93

I am currently up to date on all payments including loans and credit cards.

I pay on or around 1st of every month. Should I start defaulting now?

Tbh I don't even know what the right amount is to put away, my ex partner did all of that

I don't even know what a reasonable amount is for the parts you have mentioned I'm just so lost and stuck

£30 a month was for me and my 2 children