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  • #1

    Help deciding whether to apply for a DRO

    I am currently on a DMP but circumstances have changed and our finances are in a bit of a mess. Let me explain.....

    I have done another income/expenditure run down. I have gone through it plenty of times and added everything I can think of.

    It boils down to having an income of £1491.28 and outgoings of £1578.50 per month. This isnt including internet and tv subs as I didnt see any place to add them on the form I used. Also, my 2 lads play football and have £5 subs each per week, I dont know where to add that.

    Anyway, on my DMP I had around £131 to pay per month to various creditors. I dont know how I can do it anymore.

    To be clear as to why we have had a change in circumstances, one of my lads left education and has become a non-dependant as he is now 19. He is in the process of claiming jobseekers, but he has been told it could take 6 weeks. And due to this our monthly council tax has gone from £8 to £25.

    Looking for experienced opinions on what I can do.
    I can post my IE figures on here if needed.......or pm etc

    Any more help appreciated.

    Also thanks to Niddy and Elsa for advice this week
    Tags: advice, bankruptcy, cab, car, charges, child, con, council, council tax, cra, credit, credit cards, creditors, date, debt, debt problems, debts, default notice, defaults, dmp, fines, fos, help, household, income, inheritance, insolvency, internet, iva, jobseekers, loan, manchester, mat, niddy, on hold, online, pay, payments, people, points, problems, questions, student, tax, unemployed, unsecured, wales, work, £50
  • #2
    Re: Help deciding whether to apply for a DRO

    I'll ask Riz to pop in, he's pretty good at this sort of thing or knows people who may be good starting points
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    • #3
      Re: Help deciding whether to apply for a DRO

      Have to read and run for an hour or so, but I will be back later with some questions I'll need answers to.

      There is always a solution to debt problems, no matter what, so we'll do our best to work out the way to go.
      I'm an official AAD Moderator and also a volunteer, here to help make the forum run smoothly. Any views or opinions are mine and not the official line of AAD. Similarly, any advice I have offered you is done so on an informal basis, without prejudice or liability. If in doubt seek advice from a qualified insured professional - Find a Solicitor or go to the National Probono Centre.

      If you spot an abusive or libellous post then please report it by Clicking Here. If you need to contact me, for instance if I've issued you a warning, moved, edited or deleted your post, please send me a message by clicking my username.

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      • #4
        Re: Help deciding whether to apply for a DRO

        Questions...

        - Unable to pay your debts in full?
        - You have no property?
        - Other assets worth less than £300. Most household stuff would not count towards that.
        - Car worth less than than £1000 according to Parkers or similar?
        - Debts are unsecured commercial debt, and are not exempt ones such as student loan/arrears, magistrates fines, child support payments.
        - Less than £15K
        - Disposable income less than £50 per month according to the CFS using up to date figures?
        - You have no outstanding bankruptcy order or other current insolvency proceedings (IVA etc) against you?
        - You are resident in England/Wales?
        - Any outstanding assets like an inheritance expected soon?

        Now, can I ask why you cannot pay the debts? Unemployed? Long term sick? Something else?

        Is that reason likely to last? i.e. in the next few years could circumstances change meaning you might be able to pay all the debts off?

        If so, is that likely in the next 12 months? Or is your surplus income likely to go above £50 per months in the next 12 months?

        Basically need to work out if there is any realistic alternative here, and if your situation is bad enough to merit a DRO.

        Plus if your circumstances changed within 12 months it could mean a DRO being revoked, which would put you back to square one.

        You also need to be aware that a DRO is as bad on your credit file as a full bankruptcy, so you would have to accpet that there would be no or minimal credit available to you for at least 6 years.
        Last edited by Riz; 2 August 2013, 13:55.
        I'm an official AAD Moderator and also a volunteer, here to help make the forum run smoothly. Any views or opinions are mine and not the official line of AAD. Similarly, any advice I have offered you is done so on an informal basis, without prejudice or liability. If in doubt seek advice from a qualified insured professional - Find a Solicitor or go to the National Probono Centre.

        If you spot an abusive or libellous post then please report it by Clicking Here. If you need to contact me, for instance if I've issued you a warning, moved, edited or deleted your post, please send me a message by clicking my username.

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        • #5
          Re: Help deciding whether to apply for a DRO

          Originally posted by Riz View Post
          Questions...

          - Unable to pay your debts in full?No
          - You have no property? No
          - Other assets worth less than £300. Most household stuff would not count towards that. No, not that I know of.
          - Car worth less than than £1000 according to Parkers or similar? £860 on webuyanycar.com
          - Debts are unsecured commercial debt, and are not exempt ones such as student loan/arrears, magistrates fines, child support payments. All are credit cards, store cards and online catalogue.
          - Less than £15K? In my name its approx 11k , wifes name 5k
          - Disposable income less than £50 per month according to the CFS using up to date figures? Its in negative at the mo.
          - You have no outstanding bankruptcy order or other current insolvency proceedings (IVA etc) against you? No
          - You are resident in England/Wales? Yes
          - Any outstanding assets like an inheritance expected soon? No

          Now, can I ask why you cannot pay the debts? Unemployed? Long term sick? Something else? I have been homemaker, wife works. We get topped up with tax credits. Guess thats just unemployed.

          Is that reason likely to last? i.e. in the next few years could circumstances change meaning you might be able to pay all the debts off? I guess it could change in time, but no guarantee. Certainly not in next year.

          If so, is that likely in the next 12 months? Or is your surplus income likely to go above £50 per months in the next 12 months? Its probably going to get worse in next 12 months at this rate

          Basically need to work out if there is any realistic alternative here, and if your situation is bad enough to merit a DRO.

          Plus if your circumstances changed within 12 months it could mean a DRO being revoked, which would put you back to square one.

          You also need to be aware that a DRO is as bad on your credit file as a full bankruptcy, so you would have to accpet that there would be no or minimal credit available to you for at least 6 years.
          As for the no credit for 6 years, that would please me. No temptation. Never again do I want credit.

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          • #6
            Re: Help deciding whether to apply for a DRO

            Well, in that case it does seem like it may be a good option.

            There are no approved intermediaries here, so you would have to approach one yourself. Only they can truly advise you on suitability and arrange one.

            Local CAB often have some, although they vary in the quality of the advice just a tad. Same with Christians against poverty.

            Place like National Debtline (freephone 0808 808 4000) may be one of the best places to start.

            There are also several approved intermediaries who post on the MSE forums whose advice I would trust. debt doctor & fatbelly to name 2. They are not in Manchester so could not set you one up, but if you struggle to get official advice you could post/PM them over there.
            I'm an official AAD Moderator and also a volunteer, here to help make the forum run smoothly. Any views or opinions are mine and not the official line of AAD. Similarly, any advice I have offered you is done so on an informal basis, without prejudice or liability. If in doubt seek advice from a qualified insured professional - Find a Solicitor or go to the National Probono Centre.

            If you spot an abusive or libellous post then please report it by Clicking Here. If you need to contact me, for instance if I've issued you a warning, moved, edited or deleted your post, please send me a message by clicking my username.

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            • #7
              Re: Help deciding whether to apply for a DRO

              Thanks, I will keep you all informed what I decide to do and what happens

              thanks again

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              • #8
                Re: Help deciding whether to apply for a DRO

                Please do.

                If you post elsewhere, let us have a link to the thread if you don't mind.
                I'm an official AAD Moderator and also a volunteer, here to help make the forum run smoothly. Any views or opinions are mine and not the official line of AAD. Similarly, any advice I have offered you is done so on an informal basis, without prejudice or liability. If in doubt seek advice from a qualified insured professional - Find a Solicitor or go to the National Probono Centre.

                If you spot an abusive or libellous post then please report it by Clicking Here. If you need to contact me, for instance if I've issued you a warning, moved, edited or deleted your post, please send me a message by clicking my username.

                Comment

                • #9
                  Re: Help deciding whether to apply for a DRO

                  I really hope this works out for you Bluearmy. Looking at your CFS and circumstances it seems the best way forward for you if it all goes through OK.
                  Please keep in touch whatever happens
                  Take care,
                  Elsa x

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                  • #10
                    Re: Help deciding whether to apply for a DRO

                    Just another quick question.....
                    If I send off emails/letters to all the creditors and attach/include a copy of the CFS I made on the NEDCAB website and offer token £1 payments. Will this affect my chances of getting a DRO?
                    I feel obliged to offer the £1 whilst I get to grips with getting everything spot on before I contact Nationaldebtline.....
                    I just dont want loads of charges added because I havent kept them informed.

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                    • #11
                      Re: Help deciding whether to apply for a DRO

                      Originally posted by BlueArmy View Post
                      Just another quick question.....
                      If I send off emails/letters to all the creditors and attach/include a copy of the CFS I made on the NEDCAB website and offer token £1 payments. Will this affect my chances of getting a DRO?
                      I feel obliged to offer the £1 whilst I get to grips with getting everything spot on before I contact Nationaldebtline.....
                      I just dont want loads of charges added because I havent kept them informed.
                      I think the FOS will expect charges and interest to be stopped once the creditor has been made aware of your financial difficulties..If you send the I/E statement showing you can only pay £x, the creditors should accept that...certainly for an initial period anyway, they may ask for another in 3 or 6 months. Not sure if you are defaulted on these accounts, because if you're not you will be when they vary the terms to allow you to reduce payments...this will put a marker on your credit file, for 6 years from the date shown for you to settle on the default notice..

                      I'm not sure if having defaults on your CRA file is worse than having a DRO on the file, someone will tell you.

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                      • #12
                        Re: Help deciding whether to apply for a DRO

                        I would speak to National Debtline without further delay, and do nothing until you've spoken to them if it was me.
                        If you then inform your creditors that you are in discussions with National Debtline about your situation (you don't have to tell them any more than that) then they will have to put your account on hold for a minimum of 30 days to allow you time to seek a remedy.

                        Elsa x

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