Hi Endo

IVA or DMP may not be necessary. Your unsecured debt is governed by the Consumer Credit Act 1974. In April 2007 there were changes made to the act to tighten up compliance issues with lenders. It is possible, and there has been some success in having individuals credit card debts and unsecured loans legally written off as a result of lenders being unable comply with the terms of the Consumer Credit Act. It is worth looking into.

you need to shop around.

there are free services - but funded by the creditors

the CAB - impartial - but only initial support

then the fee chargers - some take more than your initial payment (first two or three payments), so if you do choose a fee charger then make sure its one that will only take your first payment, anything more than that is them being greedy and taking advantage.

Hi

read your email and you seem to know most of the basics however I would contact the citizens advice bureau as they have very good financial people there who can sort everything out for you, dont be embarassed as they have heard it all before and that is what they do best. also definetly include the welcome loan and good luck

Hi i have a DMP its with The consumer Credit Counciling Service, its gov regulated, they work out your budget and stuff for you and there is no charge. you do need to be aware that your creditors do not have to stopthe intrest.

Hope this is some a litte help

1. The Welcome Finance loan would be eligible, but they would try to apply pressure to you normally.

2. not sure maybe worthwhile as it could reduce the debt

3. this is the next dilema for you if you do go down the DMP whether to go free(funded by the industry), so i personally would be careful as that does mean they are funded by the creditors all be it through charitable donations.

The other type is fee paying one , the normal is that your first payment goes towards setting the DMP up and then 15% after that , but you do have the peace of mind that they work for you directly

and yes they literally do it all for you.

I would suggest that you dont need a debt management plan, you already have an idea of what you are wanting to do, you dont need a debt management company to over charge for doing something.

What you need to do is just sit down with someone and get your finances in order. If you are on 22k a year you are taking home just short of £1400 a month. That should give you plenty of money to pay bills, repay debts and still live a little.

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Thanks to you both for your advice, and thats a very good point about pooling the money I pay to welcome for the loan, I never thought of that.

I think I will go down the DMP route as I dont think I am able to deal with all the legal formalities of an IVA or bankruptcy just yet...

Although paying this money for the next 7-8 years is a little daunting...

Just a couple more questions if I may?

1. If I decided to go for a DMP would the welcome finance loan I have be eligible? I have literally had the loan for about 6 weeks...

2. Is it a good idea to send this letter to all the creditors chasing me first to see if they're legitimate or not?

http://www.moneysupermarket.com/community/forums/t/debt-advice-needed-possible-bankrupty-16856.aspx

3. Is a DMP company a good idea? Do they charge much? Would they literally sort it all out for me?

Many thanks again

Endo

First of all you have to weigh things up , firstly an IVA may fail before it even starts as your creditors may not agree , but if it does go ahead you don`t get all the hassle from the creditors, the interest stopped and part of the debt written off. also i would not worry about colleagues finding out.

Then with a DMP it cant fail as such but the creditors may not accept the plan to start off with , but generally once regular payments start going to them they start playing ball and stop the hassle and interest, although they are reluctant to write off the debt, but with this you could keep your credit card.

As for your welcome finance loan why the hell do you wanna keep it, what ever route you go down put it on there because then you can add that money to the amount you can pay meaning more chance of success with an IVA as they will get larger amount of there money back and it also means that a DMP would be done quicker as you would be paying more into it.

Bankruptcy Should be your Very very last resort and really i don`t think it would be a good idea as you have means to make some sort of repayment towards

An I.V.A. May not be available to you. Have a chat with a person whom deals in iva. If you don't know any ,email me for an number. As I believe you would need some sort of home ownership for the iva to work on. Its about 30% of every pound you owned, to paid back. And last for 5 years. So if you own 100k you would need to pay back 30k but have to follow guild line from the iva set out from the iva supervisor. Failing to do so will have you bankrupt.During your iva you can not have any credits or loans. The interests mounting on your debt will be stop and the iva supervisor will sort an payment package out with you and your creditors. Maybe bankrupt would be an answer to your situations. going through an iva is stressful for the first few years but once the iva is over, the light is shinning at the other end. And believe me you don't have to get into money problem faster than you can spend it. I don't think your work colleagues needs to know anything about the iva. But be warn!! The iva supervisor acting for you will cost about 5% of the package sorted out for you, they will charge you £60 per letter or phone call made on your behalf and will need paying upfront.Well mind did, I have just finish the iva and its been bitter sweet all the way. One thing for sure you aged a little after it all.

Hello to all,

This is my first post, I have been looking through the other posts on this site for advice and although a lot of the information has been very useful I am still not sure what path I should take...

Here is my story;

I am currently 24 soon to be 25. At 18 I was very irresponsible with money and was convinced I could afford the vast array of unsecured loans, store cards and credit cards that were SOLD to me. I struggled til I eventually broke down, was out of work and couldnt afford to pay anybody anything. Which resulted in ALL of my debts being moved on to collection agencies.

Whenever I got back in to work again, I would respond to the agencies with a repayment proposal and start paying them off again. I have gone through this cycle a few times now over the past 6-7 years and seem to have gotten nowhere with it.

I have finally landed a more promising, stable and better paid job (22k pa). Which I have been in for just over a year now. But due to past experience was wary of wether I should contact the agencies to arrange payment again straight away.

I want to get things sorted, but I am not sure what the best path is...

I am currently in £29,000 of debt with 13 creditors. All of it is unsecured debt most of which I havent made any repayments to in years. I have one CCJ and I am currently paying the remainder to the creditor on a monthly payment plan. I am living in privately rented accomodation and currently own a car. I do have one credit card with the lowest limit they will allow (£200), which I NEED to pay some of my bills. I also have an active "bad credit=high interest" loan of £1500 with welcome finance over 2 years which I am currently paying £103 a month and have included this payment as a bill in my financial summary below...

I have worked out a realistic financial summary and have worked out I can afford to pay a maximum of £238 per month if I lived on a budget. If I do this through a debt management proposal (which i would do myself to save on costs) it would take me 10 years to repay evrything... But from what I gather I would pay the same amount through an IVA for just 5 years and have the rest written off...

Only problem is I have heard nothing but bad things about IVA's as well as the fact that I would HAVE to include my credit card and current active loan into the IVA, which will no doubt cancel my credit card off which I could do with keeping.

So what do I do?

Do I arrange repayment through the creditors myself and hope to god that I stay in employment and can stick with it for 10 years?

Or do I take out an IVA, have my credit rating shot down even more, hope that it is resolved fairly and dont get screwed by the apparent IP-cowboys out there?

Also a few things I am unsure on;

1. If I decide to take the IVA route would they have the ability to contact my place of work? As this would be a big problem as I work in a small company and dont want my colleagues to know about this massive skeleton in my closet.

2. I have heard about solicitors sending letters to creditors saying that it was irresponsible of them to lend high sums of money to a young person who could not afford it and that a threat of court action "scares" them out of pursuing the debt further. Is this true?

3. If I do decide to take the IVA route, which companies have not lost their ethics and can be trusted with doing their job properly?

4. Is it a good idea to send the letter that I found on this forum about forcing creditors into confirming they have a right to chase the debt first by supplying documentation before I arrange repayment so I know who I actually owe money to? Or can this result in yet another CCJ on my record by ruffling their feathers?

Any help will be greatly appreciated as I have no idea what to do, either way its gonna cost me £238 per month for either a long time or a very long time. Unless someone knows a better option?

Many Thanks

Endo