Moving forwards

Debtfree_oneday · 19 July 2019 at 9:20AM

Hi everyone :wave:

Over the course of many years, I've managed to accumulate a fair amount of debt. Loans and credit cards mostly.

About 2 years ago I seriously considered going into an IVA but didn't in the end because of my work. I couldn't manage the monthly repayments so entered into a DMP with Stepchage, who were great and since then I've paid the minimum every month. This has given me enough to live on and cut back on everything else.

I've been trying to sell a property for a couple of years and it eventually looks like it's going ahead :beer: this means I'll have approx £10,000 in the bank.

My debts with Stepchange add up to around (according to their estimate) £65,842 over 12 accounts :eek: When I add these up on my credit file they come to £56,249 (same on Equifax & Experian)

One of the bigger debts (around £16,000) was passed to Cabot and they offered a settlement of £5000 which I currently don't have but will in a month or two. Once the property is sold I'll be saving on the mortgage but of course will have to pay rent. This does, however, reduce my outgoings by another £200 or so.

I am so sick and tired of being in the mess. I need to find a way to utilise this money in the most effective way possible, pay off as much as I can and get my credit score back up as much as I can (currently sitting firmly in the middle of 'poor' according to Experian)

Would you recommend hitting the biggest debts with the money I get and then taking everything back out of DMP? or paying off as many of the small ones as possible and then leaving the bigger ones in DMP?

Any advice would be appreciated - Thank you

NeverendingDMP · 19 July 2019 at 10:39AM

I'm not sure what the right answer is financially but emotionally settling the bigger ones will give you a boost as your debt total will seem to drop faster. others will give the correct advice money wise but if your sick and tired of the debt this may make it seem more possible and get you below the 50 k barrier. Your 200 a month spare could then be the beginnings of a settlement fund.
Are you going to keep some as an emergency fund. if your DMP has a few years to go keeping a bit aside might be useful to.
if you have defaults they are stuck with you for six years so not sure how your credit score would change too much, agains others will advise better on that...mines stuck firmly in poor/fair..

NeverendingDMP · 19 July 2019 at 10:40AM

also if they suggested 5000 no reason you cant try a counter offer.. good luck

Debtfree_oneday · 19 July 2019 at 11:27AM

I should probably note that all of the debs except one are showing as defaults now on my credit file.

Moving forwards

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