Debt settlement/debt management plan/ or do it myself
I've been a lurker on this board for awhile. I actually just recently got in touch with credit couseling services regarding a possible DMP. It turns out that they could have me debt free by 2013, however, the payment was outrageous. I think it was actually more than what I pay in a months time to my debts. There was no way I could afford it. So that leaves me wondering- what's left? Debt Settlement- to which the man I spoke with said was a bad idea because I would get taxed on the difference and it would ruin my credit (well considering I'm already behind on most all my bills- I seriously doubt it could do more damage than I already have). Or do I try to do this myself? My debtors all have hardship plans that I could probably afford if I made some modifications to my budget. At this point even bankruptcy sounds good. I'm tired of the stress, tired of being broke and harrassed for money I don't have. I've got about 22K in unsecured debt. God, that sounds like so much I am even embarrassed to put it out there. Something has to give- anyone offer me any advice. I feel like such a deadbeat at this point. I always was so careful with my bills but now things are tight and I am the only income in my household. :sad:
Thanks in advance for reading this ramble...
Do it yourself. DMPs mess up your credit just as much as stop
Do it yourself.
DMPs mess up your credit just as much as stopping paying and settling them yourself.
If you stop paying all of your accounts, how much can you save monthly for a settlement fund?
It is a debt solution plan
It is a debt solution plan and used by all UK residents. In this Plan you continue to make payments towards your unsecured debts, and you are left with enough money for your essentials, such as your rent or mortgage, food, utilities, travel costs and so on. It is an offering to your creditors new, lower payments that you can afford to pay.
It is not binding on your creditors to accept less than the agreed payments but, as long as they can see that the you are able to pay that much payment they will allow you. In most cases lenders will also agree to stop adding any further interest and charges to your account, but this isn’t guaranteed.
So, if you find yourself unable to keep up with payments for your unsecured debts, but can make a regular reduced payment towards them, and you think you’ll be able to repay everything you owe in a reasonable amount of time, a Debt Management Plan could be the right solution for you.
Once you’re on a Debt Management Plan, providing you keep up with the agreed payments, your creditors’ demand letters and calls should stop, and legal or recovery action should stop too.