Creation being a pain with interest.

A question about : Creation being a pain with interest.

As it is, if the interest is frozen we will not be debt free until 2029

It was probably the wrong thing to do? but I felt I had no choice hence sent them the following letter. It describes one account where we will be paying Ј40 a month

Quote:

Ah well, feel better for sending it.

Best answers:

• Please gather all your paperwork relating to your debts and your monthly income and outgoings and contact a debt management charity, e.g. Christians against poverty (they won't try to convert you) or Stepchange or Payplan. It shouldn't go as far as a CCJ if you contact an organisation that will give you free debt advice and help.
  These companies may be able to help you freeze interest for a period of time, or completely or may help to get a reduction in the interest you pay. They will help you work out a monthly payment plan that you can manage
  Don't despair no situation stays the same forever. Don't let the debts make you ill, they're not worth it.
• How old is the account?
  If taken out before April 2007, send them a CCA request to see where you stand. If they don't have it, on a debt from before this date, they are a tad stuffed regarding court action.
  This helps your negotiations.
• Hi,
  Are you currently in a dmp with a free provider such as stepchange? Or are you self managing?
  Even with someone doing a dmp for you a creditor does not have to reduce or freeze interest but most usually do. If they don't the recommended route is to write a letter stating the word complaint clearly within it and then await a reply. If no luck then you esculate it to the FOS via an online form. I did this with creation and got the interest lowered they would not freeze it.
  Good luck.
• I'm with Stepchange and it's newer than 2007
• As I've said in my other thread, I am concerned about how DMP charities work.
  While of course I appreciate the work these charities do, they do not really help those of us that don't get the interest frozen but don't know what to do next.
  I am the sort of person that would happily stand in court facing the might of a large business and represent myself, a lot of people are not.
  Many people receiving the letters I received from creation would simply feel there's nothing they could do. So they contact their DMP charity, and they receive the following (quoted exactly with just names removed)
  Quote:
• Bit harsh. Never used a debt charity, but I guess they have to use their resources wisely. They have said what you can do and if you asked I am sure they would help with a complaint to the FOS, which by the way, you don't need a letter for as you can ring them to lodge your complaint.
  If you are confident dealing with creditors, then could you not run your own DMP?
• I find the best way out of this situation is to stop paying completely, I liken this to the payday loan spiral lots of people find them selves in, you end up more in debt because of creditor interest, at some point you just have to say NO, and re-take control of the matter.
  Most people are aware of the debt collection process :
  original creditor-collections-assigned DCA-debt gets sold.
  Most court actions take place at the end of the process, if ever, once a debt is sold on, all interest and charges usually stop, if a creditor is not willing to stop interest, no amount of complaining will budge them.
  At least when it ends up with a new owner, there will be no further interest.
• Bit of a catch 22 situation.
  I am suffering from health problems and one thing I have to do is avoid as much stress as possible.
  And stress for me can be something that's very trivial for most people.
  So while I am happy to face them in court if needed, while I am not scared by any of this, the stress of it is doing me zero good, hence if a DMP can take most of it off my hands and I just have to make one payment a month, it's better for me.
  Mind you, I'm not entirely sure if using a DMP charity long term will be any less stress than doing it myself.
  A bit hard to explain, if it wasn't for my bad health (I'm not talking about me being ill due to these debts, I'm talking about something completely different), I would happily run my own DMP, then again if it wasn't for my health, I could work and wouldn't need to.
• Hi,
  If running your own DMP is going to be too much then how about looking at your budget to make sure that it is leaving you with enough to get by on, maybe transport and medical expenses mean that you need to be paying less in the short term...
  If Creation are anything like Barclaycard then they will be charging you a reduced but still hefty interest based on %age of the balance being paid each month so a smaller monthly payment will obviously mean a lower %age going to them...
  I believe that SC require a minimum of Ј5 per creditor to continue to manage your DMP, if your outgoings were increased to this point then Creation will likely either freeze the interest or sell the debt on even if what you are actually doing is saving the additional you are keeping aside each month to build up an emergency fund...
  Hope this helps
  MB
• I think I'm going to take the plunge and do it all myself.
  I should tell you a little more about DMP and Creation
  I was with Payplan and wan't happy with them and their continual trying to sell me stuff, plus I found I spent every month still having to contact creditors anyway, I was advised to do it myself, but heard good things about Step change and thought I'd give them a go.
  Creation did the same thing with Payplan, reduced it so that I was hardly paying anything off at all. I wrote to the FSA, they then wrote to Creation, creation wouldn't uphold the complaint but agreed to lower the interest, part of their reply is
  Quote:
• Well that was a pleasant surprise.
  Thought I'd try talking to them rather than writing to them. Phoned the number on the letter and he wouldn't budge.
  I politely said "have I really got to write to the Financial Ombudsman to get the rate lowered, seems like a waste of their, your and my time?"
  he responded
  "You don't have to write to them, phone our complaints dept on 0800 012 1173 and speak directly to them they will probably be able to help"
  So I phoned them, very polite lady, she understood what I was saying and basically implied the other department is limited by what the computer says (my words but was sort of what she said) and that her dept can see what things are actually like and act accordingly.
  She has reduced all 3 accounts to 3% apr
  So while not perfect, my account I owe Ј6840 I am now being charged Ј17.10 interest per month and repaying Ј40,
  That's better than the Ј33 interest I was paying last month. So instead of paying off just Ј7 a month, I am now paying off Ј22.90 a month.
  Was petrified of actually speaking to them but it was a very pleasant conversation.