Is A Debt Managment Plan Right For Me?

[elisebrow]

Hello People

I am 23,538.00 in debt struggling to pay 10 creditors, I have been told an IVA will not benefit me as I will only right off roughly £6000.00 of the debt and will be paying back more than the debt itself, plus if my job finds out I will be in DEEP WATER.

I am strongly thinking about Debt Managment Plan with CCCS, PAYPLAN OR NATIONAL DEBTLINE as they provide a free service..The questions I would like to know is.

The majority of my debt is owed to Natwest Bank which is £18,900.00 what is the likelihood of them accepting a DMP If I was to apply for one?

Can I still recieve CCJ's and Default Notices whilst on a DMP? if so how long will they stay on my credit file for?

Once I completely finish paying a DMP will I be able to recieve a low APR rate e.g 6.9APR for a credit card If I was to apply for one or will it be 39.9APR because the risk to borrowing me money is higher?

Thanks for reading my concerns

Exx

[Skippy]

Hi Elisebrow and welcome to the forum.

I'm sorry but I don't know whether Natwest are likely to accept a DMP, hopefully someone else will be able to advise.

You can still receive CCJs and default notices while you are in a DMP, and there is no guarantee that your creditors will freeze interest. I'm not sure how long CCJs stay on your credit file, but defaults will remain for 6 years from the date they are issued.

Once you finish the DMP if you can get a credit card it will most likely be at a high APR. To be honest, most people don't want another credit card when they have been in a DMP or IVA!

Is it in your employment contract that you cannot have an IVA? Have you taken advice from an IP about your options?

[kallis3]

Hi, and welcome.

Firstly, you need to speak to a firm like the ones mentioned, who will go over all your options with you.

With an IVA, you will never pay back more than you originally owed plus fees. Once it is finished that is it, any remaining debt will be written off.

There is no guarantee in a DMP that creditors will freeze interest, and they can still issue default notices,though I'm not sure about CCJ's. It is only an informal agreement and creditors do not have to agree to it.

A DMP usually takes longer than an IVA to pay off. You will probably find it hard to take out credit immediately afterwards, but why would you want to when you have just managed to get rid of all your debt?

Defaults stay on your fle for 6 years after the date they were issued.

[Viki.W]

Hey elisebrow, welcome to the forum. You're in a great place for advice and support here. If you want to post a few more details then we can help further. How much disposable income do you have for the debt management and have you already spoken to someone about an IVA? X

[andrewgoodman121]

Hi elisebrow,

I went for an IVA and i have had exactly the same debt as yourself.
I should have done it ages ago as i am already 10 months in with 50 to go and am looking forward to debt freedom.
What do you do for a living if an IVA threatens your job, an IVA is an arrangement with your creditors unlike Bankruptcy.
A DMP is a quick fix solution and you could be paying for years.

[freelili]

I would just like to add that it is very unlikely that a creditor would issue a CCJ if you enter into a DMP as the court would be able to see that you are doing everything you can to address your debt. It would appear that you need to take as much advice as possible regarding your particular circumstances. Whatever road you take to recover from the pitfalls of debt will seriously affect your credit rating in the future.

Only writing a little bit of the debt off should not be a reason to dismiss an IVA as an option.

Good luck.

[andrewgoodman121]

Hi elisebrow,

I went for an IVA and i have had exactly the same debt as yourself.
I should have done it ages ago as i am already 10 months in with 50 to go and am looking forward to debt freedom.
What do you do for a living if an IVA threatens your job, an IVA is an arrangement with your creditors unlike Bankruptcy.
A DMP is a quick fix solution and you could be paying for years.

[elisebrow]

Thanks for the advice

If maybe 3 out of the 10 creditors refuse a DMP does that mean the plan won't go ahead?

I don't want another credit card after a DMP, I was just saying for instant what if...however what I would like is to one day buy a house If a DMP will wreck or hinder my chances I may have to struggle along for another 3years when my loan will finish.

I'ts not in my contract that I cannot have an IVA, its just the kind of job I do, I feel it will be a problem however I will speak to an IP

Thanks again

Exx

[elisebrow]

Thanks for your replies

I am clearly confused over what I shall do, I don't want to wreck my credit rating anymore than I already have at the same time I don't want to struggle anymore.

I called National Debtline and they worked out my monthly payment for a DMP to be roughly £435.00 for roughly 4years which is ok, I can afford this amount as it leaves me money to put into a savings account to pay the plan off sooner.

I'm a Civil Servant again it's not in my contract that I cannot have a IVA, I just feel it will cause a problem.

I have spoken to many people about an IVA. Some were practical selling the IVA to me which was very off putting as I felt pressured

Others were trying to help me out of a bad situration.

Exx

[Viki.W]

Hey elisebrow, if you can pay your debts off in full in 41/2 years then that sounds great. Just make sure that they get all interest and charges frozen. Good luck. X

[MelanieGiles]

It is unlikely that an IVA is a sensible solution for you, given that you could pay your debts of over such as short timescale. A DMP would seem to be a better solution, to assist you in repaying your creditors over a structured timescale.

[freelili]

Elisebrow

I went into a DMP and I found it to be fine, I still had some harrassment from creditors but most of them accepted the DMP as it was actually all I could afford to pay them. If you go with a good company they will do the homework and presnt this on your behalf. Its not legally binding like an IVA ie a percentage must accept or the whole thing fails.

One of my creditors refused to accept but they got paid the amount offered in the DMP anyway, they didnt take any further action apart from a few carefully 'scary' worded letters but took no further action. If a and b are not viable options for your circumstances then go with c. You can only do your best and it seems that you are trying to do that. One company decided that they were not happy and refused to freeze interest, I couldnt give them any more and told them so, they then sold the debt, nothing actually added.

I beleive that some work is being done to make DMP's better and more binding as more and more people are finding themselves struggling.

Any disrupted credit rating can be repaired eventually after the DMP is completed.

You have already taken the hardest step in recognising you need to act now. Once you have decided the best route forward for you, the fog that youre feeling now will clear.

Good luck in whatever you decide to do.

[andrewgoodman121]

Even before you enter a DMP or IVA, your credit rating will be poor anyway if you are declined from getting anymore credit.
You have to ask yourself the BIG QUESTION!!!
Do I Want To Carry On Struggling And Working My Socks Off or Do Something About It Before It Gets Out Of Hand!!
I went for the IVA solution as it is legally binding and i don't get anymore hassle from creditors and pay a fixed amount for 60 months and then it is all over.
I work for the Government as well and the IVA is Totally Private and Confidential and i haven't run into any problems whatsoever.
I won't pressure you into doing an IVA but as my debt was roughly the same as yours at least you won't get anymore hassle from creditors and you can completely get rid of the debt once and for all.
In a DMP you will still get those depressing statements through your door showing you how much you owe everymonth and you see how far they are going down in a DMP.

[kallis3]

If you can pay off your debts in 4 1/2 years in a DMP, that is so much better than 5 or 6 years in an IVA. I would think that most companies would be happy to accept that. You will also be paying back all of your debt.

I was in a DMP before IVA and all our creditors accepted this, we just had the statements, which I forwarded to the company and every so often the creditors would phone and ask if anything had changed. When told no, they were quite happy.

Give someone like Payplan a ring. They will tell you all your options and discus what is best for you.

I work for the Police. I have not informed them of my IVA, or the DMP and I have no intention of doing so.

[elisebrow]

Hello People

Just want to say thanks for all your replies.. I spoke to CCCS and Payplan today...both have drawn up a DMP for me...both plans are in the post..I will have a read through them both then will decide which one to go with.

Thanks Again
Exx