Hi Dan

the points you make a valid on both options.

Generally if the debt is payable over a realistic time period then DAS can be a very effective tool.

Regarding the equity position, as I have mentioned, the position should be clarified in writing before proceeding. The equity should be calculated at the beginning and remain static throughout the TD period.

Mark

Thanks for the input Mark

If remortgaging is an option, should this be considered ??

At present, we are not in arrears on any loans / cards etc (but this will not be a situation which will last for long)

We currently have circa ?ú600 left each month after paying out for mortgage / secured loan / car 1 on hp / car 2 on finance agreement / petrol / food / car tax / electricity / gas / council tax etc etc etc

That ?ú600 is trying to pay off credit card payments of approx ?ú1,000 a month, hence whilst we are making the card payments, we then have to use the cards to live during the month, thereby increasing the amount owed on them thereby increasing minimum monthly payments, thereby putting us in a position where we have to use the cards more each month to live on - I am sure you can see where this is heading !!!

However, on the bright(ish) side, we have a loan which we will pay off in October this year which will give us an additional ?ú200 per month to play with

In 2 years times, my maintenance payments stop as my daughter reaches 18 and my Wifes car payments end.

That will give us an additional ?ú580 a month

I calculate that if we remortgage for an additional ?ú25,000, then this will cost us an additonal ?ú110 a month over the 19 years remaining on the mortgage

The ?ú25,000 would allow us to remove approx 50% to 60% of monies owed on credit cards, thereby reducing card outgoings to circa ?ú500 a month

?ú500 a month on cards plus ?ú110 on extra mortgage payments = what we currently have left over after paying everything (plus we then have the extra ?ú200 a month come october this year which we could put to one side each month as emergency funds)

Am I trying to make a silk purse out of a sows ear ??

Hi there,

Sounds okay in theory, but are you likely to be able to remortgage in the current climate? Most lenders will only go up to around 80 - 85% of your property's value.

How much equity do you estimate you have, as I think this will determine whether a TD or a remortgage are likely options? Generally speaking, I'd say if there is little or no equity a Trust Deed might work well, if there is a fair amount of equity then a DAS might be more suitable, if there is a lot of equity then a remortgage may suit best.

sorry - may have been somewhat misleading - as opposed to remortgage, my wife and I are thinking of raising funds via a loan from our mortgage provider, which we would pay off over the term of our mortgage

As far as equity goes, I don't think we have more than 10k max, but my wife thinks we have more like 40k (it will all depend on how well property in our area has weathered the storm over the last year or so)

Consolidating can sometimes work well, but is to be handled with care. I've lost count of the number of clients I've seen who have remortgaged/consolidated and then continued to run up their card debts etc again, ending up in a much worse position. In my opinion it should only be considered if it is definitely affordable and still leaves enough spare income to deal with any debts that might be remaining.

You should also bear in mind that over the course of this loan you will pay far more back due to interest (and rates are likely to rise again at some point, which may have to be factored in). Dealing with the problem through a trust deed/DAS/debt management is therefore likely to be much less expensive, but will affect your credit rating.

The DAS scheme is a good alternative but try and get an appointment ... Ive sat for 2 hours in Clackmannashires CAB office, no joy 1 1/2 hours in 2 of Fifes no joy and The woman on the phone from Falkirk was so rude...I didnt bother going there, at least with some of the Trust Deed companies they are professional and you get a good service, there are so few approved money advisors and so many people in uncontrolable debt that I dont think its as effective as it was designed to be. I was eventually offered an appointment for December, that appointment was made in July ... How depressing !!

It's a terrible shame that the DAS scheme, which I understand cost a significant amount of public funds to establish, is floundering due to the lack of resources to assist people in taking that path.

5 or 6 months for an appointment is a ludicrous wait.

Hi Simon

Although it's not an area which I am involved, I understand that there are delays in both DAS appointments and CAB appointments through understaffing and I suppose an increase in the volume of enquiries.

Mark

managed to get an appointment at long last earlier than Dec !!I take back what I said about DAS My problem has been the extortionate levels of interest applied by credit card compaines which has not allowed me to make a dent in the balances. For example MBNA are charging me 32% on a 6000 limit so even though im paying ?ú240 a month back only about ?ú80 comes of the balance. After meeting a money advisor.. it was explained that the creditors can pursue me for the interest after the Debt repayment programme has ended... meaning there is little point in my case as the interest accumulated over the period of the Debt payment programme is larger than the debt itself..... AAAARGGGHHH Should be called Debt Addition Scheme !! Looks like a Trust Deed maybe the answer after all.

This is a nightmare.

That seems really odd simonpt. Sorry to hear this isn't getting cleared up as you hoped.

Mark & Kevin: have you heard this about the DAS scheme?

Hi all

DAS is not something we do, however my understanding is that on acceptance it stops legal action and interest, on the basis that the full debt is paid. I see no reason why creditors could pursue for interest.

Mark

Thanks guys, apparently it freezes interest and its down to the Money advisor to negotiate them to waive it altogether. Your right it does stop them from taking any action and from adding further debt in the form of interest during the DPP but once that ends they have the right to pursue you for interest that would have been accumulated. It states this on the thier website as well.

What a farce !

Trust Deed here I come

Hi Simonpt

Could you provide me a link to the website with the interest information.

It would be most appreciated.

Mark

Hi simonpt,

Could you send the link to Mark using his contact form rather than placing it on the forum?

We restrict the posting of links to the experts only in general; helps to keep the spammers at bay!!