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  • FIRST POST
    • Goodnite11
    • By Goodnite11 9th Jan 18, 9:35 PM
    • 6Posts
    • 1Thanks
    Goodnite11
    Dro and lump sum
    • #1
    • 9th Jan 18, 9:35 PM
    Dro and lump sum 9th Jan 18 at 9:35 PM
    Hi there,
    My wife and I are currently in a DRO (she was the client,im the partner) that is due to end on 30/03/18, with debts of around £19k. I have just been placed at risk of redundancy (still applying for internal roles, so not officially redundant just yet).
    I have received a provisional redundancy package which is just over £8k (potentially £9-10k after remaining leave+notice is factored in) . If I receive this before 30th March I'm guessing this would mean our DRO would be revoked?
    What would happen next would the DRO be cancelled, then we would pay off outstanding debts with the lump sum?
    Do we do this ourselves, does the OR/stepchange advise or assist?
Page 1
    • sourcrates
    • By sourcrates 10th Jan 18, 12:04 AM
    • 13,054 Posts
    • 12,363 Thanks
    sourcrates
    • #2
    • 10th Jan 18, 12:04 AM
    • #2
    • 10th Jan 18, 12:04 AM
    Your talking a matter of days, even hours, between the DRO ending, and you receiving your redundancy, it would be bad luck to have the arrangement revoked at such a late stage.

    Redundancy payments are usually made on your normal pay date, what date are you usually paid ? Can it not be delayed ?
    Last edited by sourcrates; 10-01-2018 at 8:22 PM.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Legal advice see : http://legalbeagles.info/
    • Goodnite11
    • By Goodnite11 10th Jan 18, 8:05 AM
    • 6 Posts
    • 1 Thanks
    Goodnite11
    • #3
    • 10th Jan 18, 8:05 AM
    • #3
    • 10th Jan 18, 8:05 AM
    Is it not essential to inform the Dro office? At the least I would surely need to speak to step change, they put our original application together. Just running through scenarios at the moment. My employer may pay me in lieu of notice though and at the moment the proposed end date of this individual consultation stage is 22nd of January, which is when I would then be redundant. Pay date is 26th of month so potentially they could pay the whole thing at the end of this month. They say they review things on a case by case basis so if I was still seeking employment internally and so overran the 26th, I suppose payment would then be at the end of Feb. I have a 10 week notice period which could in theory take me through to the very start of April, but I can see them letting me work the full 10 weeks.
  • National Debtline
    • #4
    • 10th Jan 18, 10:20 AM
    • #4
    • 10th Jan 18, 10:20 AM
    Hi Goodnite11 and welcome to MSE,


    It is essential that you inform the Insolvency Service about this redundancy. You are required to report any lump sum over £1000. Failure to report something like this can have consequences. If it is not reported and it comes to light later they can revoke the DRO even after it has completed and it would also be a criminal offence not to tell them and there would be a risk of legal action.


    It is a difficult situation when you are so close to the end of your DRO, but you do have a couple of choices. One, is if the payment can be delayed until after the 30th March, that would allow the DRO to complete. Alternatively, if the payment is received before the end of the DRO, and the DRO is cancelled you could use this money to try and make full and final offers to your creditors. Or, you could live off this money for a while, and save £680 to one side to pay for the bankruptcy fee in the future. You would need full advice about the consequences of each of these options before choosing one, but Step Change could discuss that with you (or any of the other free debt charities). Good luck,


    Laura
    @natdebtline
    Last edited by National Debtline; 10-01-2018 at 10:21 AM. Reason: extra sentence
    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
    • Goodnite11
    • By Goodnite11 10th Jan 18, 10:45 AM
    • 6 Posts
    • 1 Thanks
    Goodnite11
    • #5
    • 10th Jan 18, 10:45 AM
    • #5
    • 10th Jan 18, 10:45 AM
    Hi Laura, thanks for your reply, I wouldn't want to try and hide it as I won't risk consequences, as they will find out and as you say it can be revoked in the future.
    Thanks for explaining the other options, I had thought about the delayed payment but thought this might be dodgy, as you already know what you're going to receive but dodging it. But I suppose it's all about timing, I am going to try and speak with someone in work to see if there is any option of delaying payment, but my feeling is that they will essentially be terminating my contract and therefore looking to clear all outstanding matters when doing so and it would probably be against normal procedures to keep me in place for longer than necessary ie they would be paying me for the month of Feb and Mar then making payment at the end of Apr. Or if they stop my monthly salary and delayed payment I would still be stuck for paying Feb and March's rent/bills.
    I hadn't thought about the bankruptcy option but suppose it is a last resort.
    Just trying to figure out what could happen and what the options are, it's frustrating being so close to the final stretch of the DRO.
    • fatbelly
    • By fatbelly 10th Jan 18, 12:46 PM
    • 11,783 Posts
    • 8,876 Thanks
    fatbelly
    • #6
    • 10th Jan 18, 12:46 PM
    • #6
    • 10th Jan 18, 12:46 PM
    Hi there,
    My wife and I are currently in a DRO (she was the client,im the partner) that is due to end on 30/03/18, with debts of around £19k. I have just been placed at risk of redundancy (still applying for internal roles, so not officially redundant just yet).
    I have received a provisional redundancy package which is just over £8k (potentially £9-10k after remaining leave+notice is factored in) . If I receive this before 30th March I'm guessing this would mean our DRO would be revoked?
    What would happen next would the DRO be cancelled, then we would pay off outstanding debts with the lump sum?
    Do we do this ourselves, does the OR/stepchange advise or assist?
    Originally posted by Goodnite11
    I beg to differ. If I'm reading your post correctly...

    She's in a DRO, not you.

    You're getting the lump sum, not her.

    No need to inform anyone of anything.

    DROs are individual not joint.
    • Goodnite11
    • By Goodnite11 10th Jan 18, 2:43 PM
    • 6 Posts
    • 1 Thanks
    Goodnite11
    • #7
    • 10th Jan 18, 2:43 PM
    • #7
    • 10th Jan 18, 2:43 PM
    Well the debts that make up the dro are a mixture of both of us and we've previously had and have a joint bank account. I would surely still need to inform OR of the money. I don't know if then it would be a case of just re-paying of my debts.
    • Twubble
    • By Twubble 10th Jan 18, 5:48 PM
    • 13 Posts
    • 1 Thanks
    Twubble
    • #8
    • 10th Jan 18, 5:48 PM
    • #8
    • 10th Jan 18, 5:48 PM
    If the DRO is in your wife's name, it's her DRO, and it's her who has to stick to the rules. If you had both taken out a DRO (separately, as they are only for one person), then it would be different.
  • National Debtline
    • #9
    • 10th Jan 18, 5:58 PM
    • #9
    • 10th Jan 18, 5:58 PM
    Hi Goodnite11


    I think the confusion has arisen because of references to "our DRO" above. DROs can only be done as an individual, regardless of any jointly owed debts they may include. It's possible of course that both you and your partner entered DROs at exactly the same time - they may even have been handled by one and the same intermediary - and this would explain why you've talked about it as if it was one single process.


    If you're both in a DRO, you will have paid two lots of £90 fees, as opposed to one. Could you kindly clarify in order that those responding have the correct understanding?


    Dennis
    @natdebtline
    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
    • fatbelly
    • By fatbelly 10th Jan 18, 6:11 PM
    • 11,783 Posts
    • 8,876 Thanks
    fatbelly
    Hi there,
    My wife and I are currently in a DRO (she was the client,im the partner) that is due to end on 30/03/18, with debts of around £19k. I have just been placed at risk of redundancy (still applying for internal roles, so not officially redundant just yet).
    I have received a provisional redundancy package which is just over £8k (potentially £9-10k after remaining leave+notice is factored in) . If I receive this before 30th March I'm guessing this would mean our DRO would be revoked?
    What would happen next would the DRO be cancelled, then we would pay off outstanding debts with the lump sum?
    Do we do this ourselves, does the OR/stepchange advise or assist?
    Originally posted by Goodnite11
    Well the debts that make up the dro are a mixture of both of us and we've previously had and have a joint bank account. I would surely still need to inform OR of the money. I don't know if then it would be a case of just re-paying of my debts.
    Originally posted by Goodnite11
    That original post still reads to me like there is one DRO in the wife's name '(she was the client,im the partner)'.

    If you had a second DRO then yes you will need to inform the DRO Unit if the lump sum becomes quantified before the end of the moratorium (is that also 30 March?). If it is over £1990, I'm afraid your DRO must fail. Your wife's survives. Your debts come back to you, including any joint debts.

    After that I would recommend that you don't do anything quickly but wait to see who writes to you about what. I have had a case where a DRO was revoked but the creditor insisted the account now had a zero balance!
    • Goodnite11
    • By Goodnite11 10th Jan 18, 6:57 PM
    • 6 Posts
    • 1 Thanks
    Goodnite11
    Yes, sorry for the confusion we did indeed pay £90 for each of us. I thought it was one Dro as we it was handled on one form with stepchange and we have one Dro reference number.
    • sourcrates
    • By sourcrates 10th Jan 18, 8:18 PM
    • 13,054 Posts
    • 12,363 Thanks
    sourcrates
    Yes, sorry for the confusion we did indeed pay £90 for each of us. I thought it was one Dro as we it was handled on one form with stepchange and we have one Dro reference number.
    Originally posted by Goodnite11
    In that case it will only affect you.

    Try and get your company to delay payment till after the 30th.

    Itís bad show to go nearly the full 12 months and fall at the last hurdle.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Legal advice see : http://legalbeagles.info/
    • fatbelly
    • By fatbelly 10th Jan 18, 8:41 PM
    • 11,783 Posts
    • 8,876 Thanks
    fatbelly
    Yes, sorry for the confusion we did indeed pay £90 for each of us. I thought it was one Dro as we it was handled on one form with stepchange and we have one Dro reference number.
    Originally posted by Goodnite11
    One DRO reference means one DRO

    If you had two DROs you would have two reference numbers, each with the format DRO1234567

    You would have each received a different debtor's notice from the DRO Team in Plymouth

    Check what numbers you have on the register, or your debtors notice

    https://www.insolvencydirect.bis.gov.uk/eiir/

    If you give your wife's DRO number when you talk to them you're going to cause some confusion.
    • Goodnite11
    • By Goodnite11 10th Jan 18, 9:15 PM
    • 6 Posts
    • 1 Thanks
    Goodnite11
    There's two DRO refs, one for each. The wife's ends 23rd March, mine on the 30th March, I think there was an issue with details that needed corrected in mine so it started slightly later. A pity as the 23rd would have been perfect, 3 days before pay day. If it comes to redundancy I'll have to try to see if they can delay payment until after the 30th March. Bit of a stretch, but my notice period is 10 weeks and would just take me to the 2nd April, just not sure if it will play out exactly like that.
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