Hi mcneill

I had a similar case recently where debts were £75k and payment was £220 per month which means ( at best) the debt would be paid in 32 years when he was 91. I was advised that they had not discussed any other options and were put into a DMP.

With any debt situation, an advisor should run through all available options being DMP, DAS, Trust Deed and sequestration. Within these 4 there will almost certainly be a solutiion which suits.

Can you advise me of the level of debt and also if there is any equity within your property.

Mark

Hi Mark. Yes level of debt is 74k spread over eleven. Property was most recently valued at 129k although similar were only fetching 123k. Outstanding balance on mortgage is 119k, and we had in place an endowment but had to use that to live in what eventually became an intollerable situation, and reluctantly we had to face up to it.
Im really at end of tether now as to how creditors will view this and have house etc in danger. The DMP had originally £626 per month, but that was only because our mortgage provider gave us an interest only deal for a limited period. New rate was up 1st July and payments have now gone to £858.60 plus arrears. Provider will let me increase payment to £942.55 for six months to clear arrears, and then when it reverts back, all considered there will be approx £200 like i said left over per month.

Hi mcneil

Is the property jointly owned?

On the figures you've provided, I think a Trust Deed may just about be workable. I think you would need to increase the contribution (not too much), plus the equity would need to be paid. However this could be dealt with by an extension to the Trust deed period.

Sequestration could also be an option to look at. This would run similar to the above at the same rate. The advantage would be that you would not need the minimum dividend required for the Trust Deed.

Hope this helps

Mark

Property joint owned with wife. Not sure how this equity thing works as we have never entered into workings of TD. Increase in conrtibutions might be ok, but we were advised by CCCS that DMP was best option. We agreed as this was the least complicated option re house etc. In your experience. Are creditors likely to accept a reduced pro rata payment for long period, even if it may never be paid off?

Hi mcneil

In my experience I think it is extremely unlikely that creditors will accept a 32 year arrangement. Almost certainly at least one will proceed with legal action as the DMP you are in is not legally binding on creditors.

Based on the figures you describe, I dont see the house as an issue. Under a formal arrangement, your interest in the house is approximately £2-£3k and this can be dealt with by additional payments at the end.

Mark

Ok thanks I appreciate that info. So. Am I better to wait and see what the creditors do thro CCCS? as they will be getting sent the new budget soon. Or should i start to consider PTD now ?

Hi mcneill

You really need to decide what's best for you, not CCCS.

I think you have good cause to be concerned over the time period and I would advise you revisit ALL the options to see what best fits.

Mark