DRO favoured creditor??

danolikespizza · 31 August 2017 at 10:29PM

Hi

I have been reading a lot of the information available on these threads arounds DROs and I have to thank you all sincerely as it is absolutely invaluable and I am sure many feel the same.

I am in a situation in which this information is very relevant and I have to ask a question that I have not found an answer to. Please can I ask for some help?

I owe close to the limit for a DRO but I am working in an industry that will not allow a DRO, as in I would get fired, so I am working on getting another job asap. In the mean time I have worked with a debt advice charity and am making token payments of £1 to each creditor.

Since that started I discovered another debt to one of my utility providers. My advice from the debt charity was to contact them directly and try to organise payments outside of the token payment plan if they would accept this. They did and I have been paying them payments of a few pound as this was what was left in my budget.

Their agreement is temporary and is coming to an end and they say I will then owe the entire amount, which they added as the final payment of the installment agreement.

I have two questions around this. The first is the most worrying. Have I made a terrible blunder and by making higher payments to the utility provider essentially made my plan for a DRO null and void as they will consider it favouring them over the others, even though it really was by a pound or so a month? I have been stressing over this since it suddenly occurred to me and I really dont know what to do here.

The other thing is if I really scrounge, as in take money from my haircut, food budget, etc, for a month or two (not to suggest its not a realistic budget as it is, but you can always have half portions for dinner etc for a short time in an emergency) I think I could pay the utility bill off and it would be gone and especially now I would love to do that but now am worried that will look like the same thing but even worse.

The utility company even offered an option of adding an amount to my usual bill evenly over 12 months to pay it, which when a new job I could be able to do and could budget higher payments into the budget calculator assuming I am earning enough but will that again look the same as technically I am paying a debt and not others?

Please could I ask for some advice?? I have been worrying very much about this situation suddenly ruining my entire DRO plan completely by accident! Is there anything I can do to prevent it

sourcrates · 31 August 2017 at 10:57PM

Hi,

If your only overpaying by a few quid I would not worry about it.

The insolvency service won't penalise you for such a minor mister meaner.

Ideally you should stop all payments to unsecured creditors, treat them all the same, pay them nowt !!

Then get your application it, more difficult I know if your waiting to change jobs.

danolikespizza · 31 August 2017 at 11:45PM

Hi Sourcrates

Thank you so much! I was telling myself not to hope someone said that in case no one did!

I agree it would be fantastic to simply start the DRO and stop paying all of them at once and I really am doing my best to get in that position as quickly as possible.

In the mean time, I read that a priority debt like a utility cannot be put in a token payment plan and they could kind of cut the provision off as they're not getting paid? Is this incorrect, or would this mean that it would be acceptable to set a long term plan over 12 months to pay it and use that amount as part of my budget, for example, or again to try to pay it all before the DRO started? Would either be acceptable leading into a DRO so as not to suddenly be cut off as it is a priority debt? It was not included it on the list of creditors that has been sent with my budget to all my other creditors since when it suddenly appeared they were already sent. Does that make any difference?

DRO favoured creditor??

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