DMP with Payplan? - Im a NEWBIE - HELP!!!

Culater_2

Hi All, newbie here,
I have taken the step and spoken to Payplan 2 days ago, they are calling me on Saturday to go through my soa. I think I need to do a DMP - will they insist I have to do an IVA or something or do I have the option to say I wanna do a DMP?. I have compiled a 3 page report showing all income and expenditure, creditors with account numbers and amounts, list of insurances I have with renwal dates (Why do they want these??), bank details etc etc.

I have a few questions - I bank with Barclays but dont owe them anything in my creditors list - although I have an O/D facility of £2310 which I use all the time. They have never in 20+ years of banking with them had anything to say anout the overdraft and I really do not want to change bank accounts. Will I be forced to change bank account?


I have debts of £25,000 with 6 credit cards (5 creditors) and wish to do a DMP. I can comfortably afford £300 per month after I have gone through my and my partners combined soa. The credit cards are in my name though, not hers, although she has her additional card on my accounts. Can I still do DMP with both our salaries?

Sorry for all the questions but im scared!!! lol :beer:

newlywed

They are a charity organisation and so don't make money out of you and won't advise anything that's not right for your situation.

If a DMP is best for your situation then they will advise it.

As for a new bank account - your overdraft is counted as a debt if you're in it, and credit in any case, so I expect they will recommend that you get a new account with a bank not linked to anyone you owe and make sure that account has no O/d. However, ask them They are there to help you.

If you do a DMP you are meant to sign to say you won't take out any additional credit until after the DMP.

I am on a DMP with CCCS - all debt in my name and so I put down half figures for our household as OH pays half our outgoings. I understand that yes you can put down both your salaries but the DMP be in your name because they are your debts.

Honestly and sincerely, I know it's scary - but sorting out a DMP is the best thing I ever did financially.

I owed more than you and all but one have stopped interest and charges and that "one" is only charging 5% interest instead of 19%. It does take a few months before they all stop interest though (even if they start off saying they won't accept, they often change their mind when they start getting money from the DMP) - so be prepared to stick with it for at least a few months while they all decide whether to stop interest or not

There's a DMP support thread on here if you have any questions about that

newlywed

Here's the link to the DMP support thread: http://forums.moneysavingexpert.com/showthread.html?t=729285

Everyone on there is on a DMP - or considering it. Some are with CCCS, some Payplan, some are sorting out their own DMP. Lots of questions asked and answered in that thread, feel free to ask for help there too

MUMMYMOO_4

Hello! My hubby has been with Payplan since May 2007. They have been really good ~ he knew he wanted a DMP ~ no other options really ~ they helped with his financial statment ~ made it owrkable and have been dealing with the creditors for him. it was pretty intensive at first and took about 6 weeks to get it all sorted but it had been worth it. Only little complaint ~ it is really difficuly to speak to a caseworker on the phone ~ e-mail is much quicker.
Good luck ~ we'd reccommend Payplan

kel123_2

Hi culater

Welcome on board

we are with Payplan and I cannot thank them enough for the help and advice they have given us. One bit of advice I can offer is do what they say (within reason to suit you) It's not a easy road but it's better than loosing everythng. Payplan will advise you to get a basic current account and supply you with a list of banks that do them (No o/d facility no cheque book only a basic visa electron card) You will not miss all the cards/cheque book etc, in nearly 18 months we have not had call to use them once 'HONEST'. Same goes for mobile phones aswell but thats been covered inanother thread. Until dmp gets up and running and when it first starts you will get phone calls from your creditors - Payplan will tell you to tell them please contact payplan once you learn to say this the phone calls stop! I am not going to tell you that you stop worrying or that there is no stress but in our case it's alot less stressfull than it was. This board will help you with ideas and support when you need it do not be affraid to ask.

Kel

Culater_2

Thank you all for your help because although Im a big boy - I have to admit I am scared! I have a wife and 18mth old son to consider. After all my outgoings I have just over £300 left over - do u think Paypaln will still accept me on this basis for a DMP? My old payments for credit was over £525 so I can offer £300 to them realistically and comfortably at this moment in time. Opinions please?

Culater_2

Is it a necessity to change my bank account? I have been with them over 20+ years and NEVER had any hassle over my overdraft at all. And besides I can ship away at that myself.

Culater_2

Also my mortgage is with Halifax and I owe them £11k on credits cards x 2 - This is one of my creditors - how will this affect me if any?

kel123_2

Any and all debts will be included in a dmp, this inclueds overdrafts. all banks have the right to use monies in accounts to help satisfy other or the same account. So lets say your wages go in and the bank uses this to pay off some of your o/d and reduce your o/d accordingly - this will leave you no money untill next payday.

kel123_2

sorry should have said, this does not inclued Mortgages they are seen as a priority and are paid direct by you inclueding any arrears. Ofcause budgeted for within the DMP.

lonely_2

Hi there,

I have been on a DMP with Payplan for over a year and by and large they have been great. When you are first coming to terms with debt and looking at a DMP, they are great with advice, what to say to creditors, etc. It is also a hell of a lot of easier getting them to do everything for you rather than approaching each individual creditor. However, they are not a charity but a not-for-profit organisation funded by the bigger creditors. That means they are trying to get the most money for the banks but not at the expense of your comfort/basic needs.

A couple of tips I wish I had known before I started on a DMP:

- If you have an overdraft it would have to be listed as one of your debts. There is always a chance Barclays will take the money direct from your account to pay off the debt if you do not change banks (some banks are notorious for doing this, whilst others are more reasonable - I'd say don't take the chance).

- If you are going to change accounts do it now whilst your credit rating is still in tact. That way you will get a normal bank account with a proper Visa card, etc. My experience has been quite different to others in that I found it hard with just a basic bank account - you cannot book certain things online and rail tickets are a big problem. I have now got a proper card thank god!

- Download the list from the Payplan website that tells you the maximum threshold for what you can/can't spend on living expenses. It's good to know these things but remember that not everything is listed, and if you have a vital expenditure make sure they put it down anyway. For instance, I need around £70 for alternative treatment for a medical condition. When things are not so bad, and I require less treatment, I just save the extra money. This comes in handy for gifts/special occassions which strictly speaking you can't put in your budget.

- Nobody can force you into an IVA and DMPs were set up as an alternative. If you are going to be paying what you say you are, I'm sure Payplan can help you with a DMP. Joint DMPs are quite common so I don't think you'll have any problem on that front.

- Don't be put off by an IVA because of the legal implications - the affect on your credit rating for either option is about the same. An IVA may be better for you if it means some of your debt gets written off and you pay things off quicker. Also creditors have to freeze interest on an IVA but on the downside you need to pay IVA fees. It's worth looking into the option and Payplan can put you in touch with people to go through this. In the end, I opted for a DMP because I knew that the equity in my house would be affected on an IVA, and as this is mine and not my husband's debt this didn't seem fair.

- You need to be proactive when you start a DMP. Don't divulge too much information to creditors before payplan have got in contact with them, just let them know they are dealing with everything, e.g. if you miss a month's payment and you start getting hassled. They can turn nasty during this period, usually to try to scare you off the DMP (morgan stanley prime culprit!)...but just sit tight and keep the conversations short. Once you Payplan have processed your application, you will need to get the arrangement accepted. This can happen without the need for you to get involved but speaking to them at this stage can speed up the process and get interest frozen where otherwise they wouldn't have.

- Keep an eye out for the dates of when your arrangements with individual creditors are accepted. These are usually done for 6-12 months at a time. When it comes to an end, Payplan should send a new income/expenditure form so the arrangement gets renewed. This doesn't always happen and you want to avoid being slapped with huge amounts of interest whilst the renewal is being sorted...just stay one step ahead by keeping in contact with creditors and Payplan.

One other tip - don't be scared! I was too and, although it took a few months, once it was sorted and my DMP was ticking along nicely, I felt so happy and like a huge weight has been lifted off me. I don't worry about what comes through the post, being skint at the end of the month, etc. - and best still I know that at the end of it I will be debt free. It will take a few years but I'll get there. Good luck with everything :T