# Considering Debt Management Company



## wmpdd3 (19 Aug 2013)

Age: 34
Spouse’s/Partner's age:34 

Annual gross income from employment or profession: € 15,028
Annual gross income of spouse: € 10, 920

Monthly take-home pay €2,100 

Type of employment: 
I am in the private sector, my partner is a student on BTEA.

In general are you:
(a) spending more than you earn, 

Renting/ no mortgage

Other borrowings – car loans/personal loans etc 

Credit Union: €11,000 , paying €220 p/m
Aib VISA : €4600 paying €80 p/m
National Irish: €1000 paying €35 p/m
Halifax :€670 paying €35 p/m
Avant: €5100 paying €80 p/m

Also €1000 ESB bill, paying €152 per week fo r the next 6 weeks.

All bills and debts are in my name, my partner has no debts at all. 

After all my usual bills including childcare is paid I have €330 left to pay the creditors. 

I have agreed to pay €450 per month to my creditors but I cannot meet these payments and have tried to re negotiate. 

Do you pay off your full credit card balance each month? no, all restructured and no interest charged. 


Savings and investments:
None

Do you have a pension scheme? 
No

Do you own any investment or other property? 
No

Ages of children: 
1 and 2

Life insurance: 
No

What specific question do you have or what issues are of concern to you?

I am considering a debt management company handling my debts as I have restructured 3 times and I still cant afford the repayments. 

If I stay as I am I have been told that my creditors will not accept a further reduction in payments by the collection sections. If I stay as I am, I will make payments for what I can afford and have to deal with the calls and letters from the companies and what ever legal action they decide to take.
If they accept what I can offer, they will be paid off in 5 years.

If I go down the debt management route, it will take 7 years and I will pay €330 once off payment and €49.50 per month. 

What can my creditors do if I under pay on the arrangements that I have made with them?
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## demoivre (19 Aug 2013)

Have you considered [broken link removed] ?


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## wmpdd3 (19 Aug 2013)

I don't think I can get a debt relief notice as my car is worth 3 grand. And I don't think i'm insolvent I just need more time to pay of my loans.


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## unsub (20 Aug 2013)

Have a chat with MABS first. At least they will not cost you anything to talk to them.
Phone today for an appointment.


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## wmpdd3 (21 Aug 2013)

I have been working with Mabs since 2011. They were very busy at that time and as I was able to follow the online process of renegotiating my debts I went that route. I went back when I tried to do it again and they just told me to do as I was doing. 

what I really want to know is if I just reduce my repayments and the creditors do not agree, what will happen, so far they have agreed with my offers in the end, but now they all say, no, they will not give me more than 5 years to pay back what I owe.


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## ClaireM (21 Aug 2013)

On the electricity have you asked for a prepay meter? €152 per week is not affordable for you.


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## wmpdd3 (21 Aug 2013)

They can't put in a pre pay meter as our electrics seriously need to be upgraded, its an old house.


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## cremeegg (21 Aug 2013)

Keep paying the ESB

Then write to each of the others and say that unfortunately you are not in a position at present to make any payments on your loans. And ask that they contact you in future by post only.

Then if they telephone you say, all communication on this account must be in writing, and hang up.

If you get a letter, open it, check if it is a court summons, if not bin it without reading it.

If it is a court summons, come back to ask about money to see how to deal with that.

Dont worry


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## frostie (21 Aug 2013)

I think you need to clarify what you have been told by the debt management company - €49.50 a month for 7 years?? That's less than a quarter of the debt paid off! Are you sure it's not €330 per month?

You could not get a DRN because your debts are over 20k as well.

A DSA is likely to work for you as well. If you can pay 300 per month, it's 18k less costs of arrangement, and would be very likely to be approved.  Decision for you is whether you want to go through the DSA route, or spend more time paying off the debt informally.

You also have two young kids. You would be allowed to have life insurance - even basic insurance should be advised - it does not all have to go to your creditors!


www.frost.ie


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## wmpdd3 (22 Aug 2013)

Its a payment of €330 per month to the company,
€49.50 per month goes to the company
the rest would go to my debts.

I dont have the details yet but if you apportion that payment to my creditors it works out as 7 years.


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## frostie (22 Aug 2013)

wmpdd3 said:


> Its a payment of €330 per month to the company,
> €49.50 per month goes to the company
> the rest would go to my debts.



Grand - just wanted to make sure you fully understood what you were paying for!


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## unsub (22 Aug 2013)

Remember you will be paying the debt management company almost 600 euro in a year. why add another expense in order to sort out others. 
You have unsecured debts, pay them PRO RATA out of your 330 per month. This is what MABS would do if they were to write to your creditors on your behalf.
Complete a statement of income and expenditure, send a copy to your creditors and start paying the revised amount. e.g. you have 22,370 in debts, the credit union would get approximately 50% of the 330 and so on.
Remember if your are taken to court and show the I & E statement, what would a reasonable judge decide.? In all probability, he would side with you.
Once you are being fair with everyone, you should have no problem.

there is a frequent poster, Gerry Canning, you would do a lot worse than having a chat with him. he talks sense.


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## Gerry Canning (22 Aug 2013)

Thanks for the compliment unsub..
As you know my forte is PPI.
I have found Frostie well worth getting advice from.I would bounce any debt questions off him. I would ask him.

Also ,he is also from Donegal !!


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## wmpdd3 (22 Aug 2013)

unsub said:


> Remember you will be paying the debt management company almost 600 euro in a year. why add another expense in order to sort out others.
> You have unsecured debts, pay them PRO RATA out of your 330 per month. This is what MABS would do if they were to write to your creditors on your behalf.
> Complete a statement of income and expenditure, send a copy to your creditors and start paying the revised amount. e.g. you have 22,370 in debts, the credit union would get approximately 50% of the 330 and so on.
> Remember if your are taken to court and show the I & E statement, what would a reasonable judge decide.? In all probability, he would side with you.
> ...



I have done this already twice and need to do it again.

It was hell getting all my creditors to agree to a pro rata payment. I admit I was too unrealistic the first time I did it. I though I would front load the pain and get more of the debt paid off but I quickly found that I was only kidding myself with the figures on my financial statement.

The second time I got agreements even though most creditors told me court was imminent and then I went from full time to part time. 

Now I need to renegotiate again.

I have decided not to go with the debt management company as they can only really do what I am doing already. 

All interest and charges are frozen on all debts anyway. 


I will write to all my creditors again next week and offer my new payment. I will include my financial statement and all the supporting documentation as I always do, but to be honest if they dont agree I am just going to continue paying and keep all my paper trails and prepare for court.


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## Gerry Canning (22 Aug 2013)

wmpdd3; 
It appears that if you use a proper Debt Management Company, the Creditors take notice.
Fair dues to you in managing this yourself. The problem is one company tries to play off another and the circle never closes. With a Debt Comp they see all in one go and from experience it takes stress from you.
Wish you well.


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## wbbs (22 Aug 2013)

You could also use MABS, the creditors definitely take notice and usually accept their proposals and it is free.


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## DebtCert (22 Aug 2013)

Another possibility is to sell your €3k car, buy a €2k car, distribute €1k among your creditors and then apply via MABS for a Debt Relief Notice providing you meet the eligibility criteria otherwise. Be careful not to prefer one creditor over another if you do this.


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## wmpdd3 (23 Aug 2013)

The DRN is tempting but I believe I can repay my debts, just a lot slower than I thought. 

Looking at the first draught of the new budget, I can be debt free within 5.5 years. Hopefully this time is the last time I have to negotiate.

Thank you for all the valuable advice.


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## wmpdd3 (13 Sep 2013)

I had a look into the DRN but fell at the first hurdle as my car may be worth slightly over €2000,but I can't find out where they get their 'worth' price from. The car has many body work issues, surely this should make a difference? 

Seems like I more than qualify on all other terms, MABS were quite helpful and quick to get back to me when I called.


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