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Debt Free Options

markoid
markoid Posts: 7 Forumite
in Debt-free wannabe
Hello,


I'm currently on year 6 of a 46 year DMP. I am now 46 years old, if I keep this up I'll be on the DMP until I am 86...


I've looked at bankruptcy, but worry that the little disposable income I have will be drained off to my debts for several years. The same for IVA's...



My other option is to simply stop paying my debts. The debts are made up of credit cards and loans from just before the 2011 crash. In reality, can I be legally forced to pay any of the debts if I stop paying them? There are around 9 organisations involved, with debts ranging from 2k to 20k.


Thanks for any advice.
Mark
«1

Comments

  • D_M_E
    D_M_E Posts: 3,008 Forumite
    1,000 Posts Fourth Anniversary Name Dropper
    46 years is a looooong time - hope you are not paying for your DMP.
    Have you considere3d making token payments of £1 to each one, this will allow you to build up a small fund from which to offer full and final settlements which could well be accepted given the enormous timescale involved.
    Have you tried sending each one a provit letter - example here https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter replies to which may make acceptance of F&F offers more likely.

    If you are not a homeowner then, given the long timescale and depending on the replies to the letters detailed above, then consider bankruptcy or IVA - they are not as bad as they once were.
  • fatbelly
    fatbelly Posts: 23,919 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Cashback Cashier
    From the information you've given it sounds like you have large debts (maybe 50k?) some surplus income (£100 per month?) and no significant assets such as a property.

    In that case bankruptcy would be the preferred option. As in a dmp you pay your surplus income to your creditors, you do the same in bankruptcy through an IPA or IPO, but after 3 years of that it's over.

    Big difference between 3 and 46 years. Is there anything significant you've not told us?
  • sourcrates
    sourcrates Posts: 32,725 Ambassador
    Part of the Furniture 10,000 Posts I've been Money Tipped! Name Dropper
    Hi,


    Obviously this current DMP is not sustainable, if you have no assets/house etc, then bankruptcy would be my choice, an IPA (Income payment arrangement) only lasts 3 years, that`s if you get one.


    Your creditors can take legal action, should they so choose, obtaining a permanent solution to this would make your life a lot easier.


    46 years is just a non starter, you must of been given bad advice 6 years ago.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • Just_Di
    Just_Di Posts: 385 Forumite
    Sixth Anniversary 100 Posts Name Dropper Photogenic
    markoid wrote: »
    My other option is to simply stop paying my debts. The debts are made up of credit cards and loans from just before the 2011 crash. In reality, can I be legally forced to pay any of the debts if I stop paying them?

    The answer to that question is you can only be legally forced to pay your debts if a court deems them enforceable. Some may be, others may not.

    I see no harm in you first exploring the legal status of these debts by sending a s 77-79 CCA Request to the current debt owners. Have any of the debts been assigned (sold) to debt purchasers?

    If you've been in a DMP for six years I expect all the debts will have already been defaulted so the accounts will no longer show on your CRA files once the six year anniversary of the default date arrives.

    Are any of these loans in joint names because the other person would be liable for the whole debt if you don't pay?

    Is your DMP provider one of the free options or are you paying them for their service each month?

    Di
  • markoid
    markoid Posts: 7 Forumite
    edited 15 October 2018 at 6:31PM
    D_M_E - thanks for the reply. The DMP is through Payplan - they have reviewed it a few times and each time they do an IVA test, they resort back to the DMP, as I'm not eligible for an IVA, I'm told.



    In terms of the proveit letters, I'm unsure as to how that would end up with a F&F payment, if you were challenging the existence of the debt...? Unless, you mean, you get them to prove it, they do, and then you offer a F&F payment? And for those that can't prove it they call it day...?


    fatbelly - thanks for the reply. 80k, no assets. I am now married, but the DMP in mine and pre-dates the relationship. I'm unsure how that impacts an IVA or bankruptcy though.


    sourcrates - thanks for the reply. I guess the DMP has always kept in place on the basis that one day I'd earn more money. Payplan did end it once, but I just applied online again and started over.



    Just Di - thanks for the reply. All of the debts have now been passed onto debt collection companies - some are in the 3rd or 4th iterations. None are in joint names, and none were secured. Payplan; free; are the DMP agent.


    Thanks all for the great advice. I'm unsure as to entertaining the prove it or the 77-79 CCA option at this stage, but will have a look at both in more detail.


    NB: I do have two CCJ's, one from 2015 and one from 2017 - knew nothing about them until I got my credit report last week.
  • fatbelly
    fatbelly Posts: 23,919 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Cashback Cashier
    Payplan are good but you have an odd arrangement here.

    Why not have a chat with them and ask them why they are not recommending bankruptcy? It seems the obvious way forward from what you've said so far. It's an online process now and costs £680

    You're not going to get rid of 80k of debt by the other methods and you now face enforcement of two ccjs
  • Just_Di
    Just_Di Posts: 385 Forumite
    Sixth Anniversary 100 Posts Name Dropper Photogenic
    markoid wrote: »
    NB: I do have two CCJ's, one from 2015 and one from 2017 - knew nothing about them until I got my credit report last week.

    Can you provide a little more information on the two CCJs.

    Were either/both of the claims served on an address where you were not living at the time which is why you say they came as a surpise when you checked your CRA report last week?

    How much are these CCJs and what enforcement action has been taken/threatened so far?

    Di
  • markoid
    markoid Posts: 7 Forumite
    The 2015 is for £3k and cites an old address. The 2017 is from my current address is £4k and doesn’t actually ring any bells in terms of a summons etc.
  • markoid
    markoid Posts: 7 Forumite
    No enforcement action as I’ve not been aware of them. Is it possible they are for debts on my DMP?

    I’m guessing the existence of CCJ’s makes BR more of an option than going down the CCA route?
  • fatbelly
    fatbelly Posts: 23,919 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Cashback Cashier
    If you ask the court, they will tell you who took the court action.

    If it's Northampton, you may find email the best way to get an answer.
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