As I have said before some people are happy with a larger company, some are happier with a smaller company, it's their choice.
If people are happy with the CCCS and they are being advised of all options available to them, then I don't see that there's a problem. And if a person is happy with the advice given then I don't see that there's any need for them to be getting further opinions. If they're not happy or comfortable with the advice then that's a different matter.
Further to David's post above I can see a potentially good reason for using a CCCS DMP, which might come as a shock after my previous comments about them.
It is to do with the way the payments are accounted for.
In a paid DMP a fee of say 15% is taken off the payment, meaning that for a £10 payment £8.50 goes to the debtors account. With CCCS, presumably the full £10 is credited to the debtors account, wuth CCCS getting their 12% kickback from the creditor.
Therefore the benefit to the creditor is actually little different, but the benefit to the debtor could be quite considerable.
It is my understanding that with a CCCS DMP full credit is given for the full payment to each each creditor, and they then get paid by the creditors directly. So creditors do not get paid in full, as with a fee paying DMP, but the debtor technically pays earlier - unless of course creditors do not cease interest and charges.
Apologies Melanie but I'm not sure if you are agreeing with me or disagreeing!
I think my example could probably have been clearer.
I'm suggesting that in the case of a fee paying DMP, for a £10 payment to the DMP company around £8.50 would be paid over to the creditor after fee deduction resulting in £8.50 going against the debt.
With the CCCS model, £10 paid via CCCS results in £10 going to the creditor and £10 against the debt.
I am then assuming that the fee due to CCCS for the collection is then paid from 'other monies' and NOT deducted from the debt.
This results in a net gain in debt reduction for the debtor of, essentially, the fee margin of the paid DMP company, or around 15%.
However as the creditor is paying the 'fee'to CCCS, albeit from other monies (I hope), then the creditor actually is very little better off.
So if the debtors motivation in switching to the CCCS is to benefit their creditors this is somewhat illusory, because overall they are only a little better off.
However if the motivation is to benefit themselves, the result could be worthwhile.
The way I see it: In a fee charging debt management plan, At the end of the plan, the debtor will have repaid 100% of the debt, so the creditor gets 100% of the debt. The debtor also obviously pays the DMP monthly charges too. In a CCCS DMP, the debtor pays 100% of the debt but the creditors do not get 100% of the debt as the creditors have to pay CCCS.
However if a person has, say, £100 a month disposable income, if they pay this via CCCS they will be paying for less time than via a charging DMP company, although the net return to the creditor won't be significantly different.
I can see that (with Viki) you are looking at it from a slightly different viewpoint , ie I would argue that whether the creditors consider they have received 100% of the debt or not is basically an internal accounting matter.
The end result is the same.
In respect of interest and charges I would have thought CCCS would have a better chance, because of their relationship with the industry, of getting these frozen, as long as the creditor was known to them.
I have spoken to size 5 before, didn't realise that he was the guy from Cleardebt, he suggestd the dmp after I explained all my circumstances so I suppose he knows what he's talking about, he said a IVA would be too costly to me
One thing I don't understand and it applies to both companies is this:
both there seems to be a months time lapse between me paying the dmp company and them passing the funds onto the creditors e.g. If I sign the DMP with cccs I pay them the funds on 1st March, they then pass the funds onto the creditors on 25th, however, before that I am due to pay credit cards on 17th February and loans on 5th March, in effect the credit cards will be paid a month late and the loans 20 days
will the creditors be ameniable with that?
cccs do suggest paying creditors a token amount - it would have to be as I couldn't afford to pay them as well as the £725 to cccs, anybody been in a similar situation with their dmp
I was in a DMP, and I never made any token payments.
As to your payments to CCCS, I wouldn't worry about the date the payments go out, the creditors will be getting their money. They make just one paymet a month, otherwise it could be very confusing trying to do different payments on different days.
I know Size5 knows his stuff, and I don't want to upset him here, but I'm wondering why he advised against an IVA if you have £725 a month to pay to a DMP?
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I wonder why an IVA would be too costly to you? DMP companies have a duty to pass funds across to your creditors I am sure within 7 days of receipt, so it seems a little odd that it is going to take so long unless the first payment is being retained as a set up fee.
This should not be the case with CCCS who of course do not charge any fees - at least not directly of the debtor.
How much do you actually owe to your creditors as a matter of interst?
I wouldn't be upset at all Jan, the unfortunate thing of course is that I do not have access to my records from home (nor do I actually know who skintofleek actually is unless he or she contacts me again offline) so I can't really comment further.
There may of course be a number of reasons why an IVA may not be the right idea, equity, stability or otherwise of employment etc etc. It may of course also be that the debt seems to be able to cleared, assuming interest freeze, within a period whereby creditors would prefer not to look at formal insolvency proceedings.
Regards.
Cert DR
23+ years in debt advice
I do not post for anyone other than myself
I owe approx £48k, after I have paid my creditors and bank fees, parking etc I have approx £250 left out of £1825, luckily partner has always paid rent, car loan, insurance and those kinda things, i used to contribute approx £5-600 to the pot a month but that has gone down and down to near enough zero
the dmp would free up a lot og my wage packet to contribute to the household
cccs do suggest paying creditors a token amount - it would have to be as I couldn't afford to pay them as well as the £725 to cccs, anybody been in a similar situation with their dmp
hi skint, it sounded from this as though you were intending to pay some creditors via the DMP and others token amounts, is that right ?
