Switching DMP from Kensington Finance to StepChange. Help.

[ammoh]

Hi all,

 

Glad to be here. I'm a long time browser and a new user. This forum has gave me great ideas in the past and I have helped my friends by reading advice on here. Now for my story.

 

I have been with Kensington Finance for over 5 years. I was aware of free ones but thought that it was too much hassle as my debts were surrounding me. I was not thinking clearly and wanted a quick way out. In fact, I got referred to them by someone I knew. He said that they are good, no hassles blah, blah blah. Like a naive person, I arranged a DMP with them. They put me on a DMP on £90 a month (£49 paid to 3 creditors and £41 for their 'management' fees). I agreed and forgot about them. Currently I don't work. Ironically I'm studying to become an accountant. lol. Before I was working with computers and did a degree in Multimedia systems.

 

Just last week, I got a wake up call from one DMP company. Someone called me up and managed to obtain my credit history. She told me that I have £8500 debt (with 3 creditors), which will take me about 12 years to pay off on my current plan, and was trying to sell me an IVA. I simply told her that I'm not working and therefore I probably won't be eligible. I simply put the phone down. I wanted to check how much debt I had left. Originally I had just under £11,000 debt and it doesn't take long to work out that only £2,500 has been paid off so far. Since that time I have paid Kensington Finance £2460 (£41 x 12 months x 5 years) in management fees which could have easily been paid towards the debts if I went for the free one.

 

After that call, I called up StepChange and decided to go with them. They phoned me on Monday 02 June and set up a DMP with me. They worked out that £102 a month is reasonable for me and I should be debt free in 6 years 4 months, if my situation don't change.

 

Today I phoned up Kensington Finance to cancel and explained my reasons why. They said that we will only charge you £10 in management fees. They also said that changing the DMP over to StepChange might cause bother to creditors and they might hassle you again so stick with us. Under the new plan it will take you 6 years 9 months to be debt free in my current situation.

 

So what I want to know is that if any body had problems changing over?

Will it cause problems with the creditors and for me?

Should I stick with Kensington Finance as they have my details or send the paperwork back to Stepchange to get the DMP started?

 

Sorry for long post. Any other advise gladly welcomed.

[oleg]

Not wishing to be rude but, if you want my reaction . . . You say you've been browsing here for long time yet you're unsure about whether to pay for something you can get for free, and you even let a feeble desperate retention attempt sway you?

You should consider switching not only your d m p but also your choice of study. Wake-up time, methinks .

And have you checked that all your creditors have proper agreements?

Any unfair charges?

If not, time also for CCAs and SARs.

[citizenB]

It is a real shame that you didnt realise that it would have been better for you to go on the free DMP much earlier. As you now know, nearly £3,000 could have gone toward your debts and your situation reduced by a good amount of time !

 

There should be no hassle from your creditors with the change over. If there is, then all you need advise is that the debt to them will be repaid much quicker by you going with the free DMP.

 

Did you check your debts for charges and PPI ?

[National Debtline]

Hello there,

 

Although we do not administer DMPs ourselves we have a significant amount of experience in setting up DMPS for our callers. We use both Stepchange and Payplan to administer them on our behalf. I've been involved in countless cases where callers have switched from a fee-charging firm to a free provider, I've yet to come across a case where the creditors have made it difficult for anyone. Afterall, the'll be getting a better cut of the surplus.

 

Really hope this helps!

 

Very best wishes,

 

David @ National Debtline.

[Wintry]

Hi

 

There is also the option of self managing your own DMP - this way creditors receive and keep all the money paid into the plan, there are usually no fees or kick back 'donations' with self managing. Many people now manage their own DMPs with the figures set to rise in my opinion

 

Citizens Advice have there own online Self help Debt Management Plan system that is now widely used and is expanding. The cabmoney DMP resources are free to all and are not funded by creditors and receive no fees or donations.

 

https://nedcab.cabmoney.org.uk/dmp.asp

 

http://www.cabmoney.org.uk/

 

There are other self help DMP resources around (general info on DMPs, systems inc DIY below)

 

https://nedcab.cabmoney.org.uk/remedy_4.asp

 

http://www.cashflow.uk.net/

 

It is also worth remembering that creditors should treat you the same if you self manage or use a DMP provider

 

Self managing is not for everyone and its a bit of a no brainer for me with regard to going with one of free providers such as Stepchange or Payplan (remember Payplan are not a charity however)

 

Always get full in depth advice on all debt solutions

 

Best Wishes

 

W