can contacting creditors before DMP route is chosen hurt?

indebtbigtime

Hi - Have typed this once already so apologies if its on here twice

I have been on the CCCS website today and have been recommended for a DMP which will pay £1215 of debt monthly to 13 creditors whom we owe 72.5k too!. I have about £30k of equity in my house, but cannot sell due to family etc etc

I have been making payments monthly, by robbing peter to pay paul and shuffling debt, getting new credit etc etc. In June / July a significant chunk of the 30k of credit card debt will move from low rates such as 0.9 and 2.9 on too much higher rates - i think 18-20% etc etc, and approx 60% of this credit card debt is with one large firm.

What harm can it do too approach them directly explaining financial situation and asking them to freeze / reduce interest immediately?. They can only say no?

Question 2. Owe approx 9k to a gamling firm who are FSA regulated. I naively agreed to pay them in total within next 3 months relying upon a share scheme and some as yet untapped credit, and scrimping and saving every penny / ebay etc etc, in an effort to avoid an additional £1700 of charges they are threatening to backdate on to my account. I am sure the CCCS counsellor will advise that this debt should be treated like all others and my share scheme / scrimping etc be divvied up pro rata across my creditors. I was previously keen to see my debt increase by what may well be getting on for 2k..... any views appreciated?

Many Thanks

indebtbigtime

hi, just moving up as I didnt want it to get lost.....cant believe how busy this site is

thanks

lisabell

Hey might not be able to help much but will have a go, ok so you havent actually signed up with cccs yet if i have read right.
i dont think it will do you any harm to ask your creditors to freeze your interest or offer them £1 token payments for now to all of your creditors just till you get youself sorted and might also help you put a bit of extra money in to paying off your 9k debt the one that you want to get paid off right before it accrues more charges.
Explain to them that your struggling a the moment and see what they say now i too have 13 creditors to which i owe £58k and your monthly payment seems quite a lot can you afford that monthly payments first off all, also see what payplan can offer see what they offer you in regards to budget and monthly payments. They might give you a greater budget i am with a fee management company and looked at going with cccs but they wanted me too pay over £1000 per month towards my debts whereas i only pay £600 now.
So i think its defo worth shopping around.
There is no harm in you trying and talking to your creditors in the mena time though
Hope that has helped a little
Lisa

indebtbigtime

it has thank you lisa, spot on I havent signed up for DMP yet

payplan, are they non proiftable charity type org like cccs?

and the 9k debt - do you think I should go hell for leather to clear, or would I be better to refuse let them add on the interest and let cccs deal, (try to negotiate down or interest off etc etc)?

10past6

indebtbigtime wrote: »

I have been on the CCCS website today and have been recommended for a DMP which will pay £1215 of debt monthly to 13 creditors whom we owe 72.5k too!. I have about £30k of equity in my house, but cannot sell due to family etc etc

Hi

Welcome to the forum, in my opinion due to the size of your debt, have you considered an IVA?

I'm on a DMP with Payplan, but I'm in the process of an IVA applicationwith CCCS.

An IVA is only applicable to a very, very small % of people, depending on your family issue, I'm wondering if you should cionsider an IVA.

Deciding on an IVA requires serious consideration, so does considering BR, in fact so does entering into a DMP.

I would urge you to speak to various debt charities to find the best option for you prior to making any decision.

Consider contacting:

National Debt Line

CCCS

Payplan

You have NO reason to use a fee paying company for anything, they cannot offer you anymore than the debt charties.

Deep_In_Debt

Hi welcome to the forum. I'm fairly new too so may not be able to offer much help.

I'm on a DMP with CCCS at the moment. I started it in March but fell into real financial difficulty in Nov/Dec 2007. I rang my creditors at that time and offered payments that I could afford and sent off I&E forms etc,. In the main, they refused to accept my offers and I went through a nightmare time but as soon as CCCS got involved, everything changed. Interestingly, the amounts that CCCS offered my nasty creditors is less than I originally offered and they have accepted!

CCCS have an online debt remedy tool - see what that suggests and then give them a ring.

Good luck on your debt free journey. You've come to the right place for all the help and support you need.

indebtbigtime

thanks, used the cccs remedy and now waiting for a telephone appointment

whats an IVA?

CHEERS for tip re fee paying companies. Gamblers anonymous have given me exactly the same advice and suggested cccs are very good, but will try others

thanks

10past6

indebtbigtime wrote: »

whats an IVA?

Basically, you have 3 options

a) - enter into a DMP = paying your creditors via a 3rd party for however long it takes, downside, creditors have the option at anytine to take legal action.

b) - entering into and IVA = providing an IVA application is accepted, you pay the same amount each month for 5 years, creditors / DCA's CANNOT CONTACT YOU, it's a legally binding contract.

In year 4 of the 5 years, you maybe expected to remortgage, depending on that, depends whether you may have to pay your creditors any equity you may have.

Downside, if you fail your IVA during it's period, creditors may seek BR, BUT THAT DEPENDS ON THE CIRCUMSTANCES THAT CREATED IT TO FAIL.

c) = BR - I very much doubt it's an option for you,

poppyg_2

I think if CCCS have suggested a DMP and you can afford the repayments then you should go for it but I don't see any harm in writing to your creditors yourself and see what they say to your offers

Just one thing, if one of your creditors is the company you have current account with open a new account before taking any action

indebtbigtime

cant see how b beats a?

a dmp is 5 yrs according to cccs, but less if interest gets frozen, also, I would hope (pray!) that wages etc may increase during 5 yrs and can throw additional money at debts

poppyg_2

i personally would add the gambling debt firm stuff onto the DMP, otherwise maybe if creditors see on your credit report this was settled they may get suspicious/peed off as to why you could pay this but not them? I don't know, not an expert on this at all (in lots of debt myself) but sure someone will be able to answer your query probably better than I can!