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    • debt doctor
    • By debt doctor 1st Jan 09, 2:58 PM
    • 3,914 Posts
    • 5,539 Thanks
    debt doctor
    • #2
    • 1st Jan 09, 2:58 PM
    Debt Relief Orders
    • #2
    • 1st Jan 09, 2:58 PM
    Hi all, and a very happy new year to everyone.

    Just a reminder to look out for those who may benefit from the new debt relief orders ( DRO) coming in to force in April this year. There is info on the net but these are the main practical features;

    Total debt must be no more than 15k

    Must not be a homeowner ( not even with neg equity)

    Assets must be below £300 although a vehicle upto £1000 is always exempt.

    Disposable income ( after all reasonable expenses) of £50 or less. ( No provision of IPA's )

    ONLY the debts listed will be wriiten off. If a debt comes to light that pushes over the 15k limit then the order will be revoked.

    The conditions regarding restrictions on employment, borrowing, trading whilst undischarged are all the same as BR.

    Debts that can go in to BR can go in to a DRO.

    If applicants financial situation improves within the year then then the order may be revoked or applicant may be asked to contributr towards debts.

    No early discharge.

    MAIN ADVANTAGES;

    There is no involvment of the court.

    The cost is £90, and is able to be paid in instalments through payzone and post office outlets.

    There is no local newspaper advert or placed in the London Gazette. DRO info is available on insolvency service web site.

    You must apply through an intermediary ( CAB, CCCS, NAT DEBTLINE ETC) so advice must have been taken. Intermediary will asist with application, which is on line only. No fee can be charged by any intermediary.

    My thoughts;

    Are that most will be excluded via the 15k ceiling. Definately not suitable for someone in possession proceedings who may expect mort shortfall. Those applying must be certain about what they owe and who to. (biggest practical problem I think)

    Useful for non home owners, with comparatively low debts who struggle to find the £360 + for BR.

    What do you think ?


    MAKE SURE that you apply for your credit report from Experian before you apply for a DRO. If your report says you are over 15k or your personal details are incorrect then your DRO may fail.

    Best

    DD
    Last edited by debt doctor; 27-04-2011 at 9:59 PM. Reason: new information
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
  • k2nga
    • #3
    • 1st Jan 09, 3:16 PM
    • #3
    • 1st Jan 09, 3:16 PM
    Sorry to ask as i did not know anything about this. It says no early discharge so how long does this DRO last for is it a year the same as BR.

    Also are the conditions the same as BR ie. On your credit file for 6 years like BR?
    K2nga

    BSC Member 176
    BR 23/06/08
    ED 22/01/09
    Credit file BR fall off date: 24/06/14
  • DON79
    • #4
    • 1st Jan 09, 3:18 PM
    • #4
    • 1st Jan 09, 3:18 PM
    think it will be of benefit to some but like you said, it will exclude quite a lot of people because by the time you get to the stage of realising BR is your only option, most peoples debts will be larger than this and you also probably cannot remember to include every single debt.

    I was wondering if there would be any new system brought in considering the amount of people who have been going BR.

    Thanks DD, useful info.
    BSC #215/No.1 Jan 09 Club
    • debt doctor
    • By debt doctor 1st Jan 09, 3:18 PM
    • 3,914 Posts
    • 5,539 Thanks
    debt doctor
    • #5
    • 1st Jan 09, 3:18 PM
    • #5
    • 1st Jan 09, 3:18 PM
    Hi K2,

    Yes discharge after 1 year, credit file 6 years as you say.
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
    • peachyprice
    • By peachyprice 1st Jan 09, 3:26 PM
    • 17,033 Posts
    • 38,702 Thanks
    peachyprice
    • #6
    • 1st Jan 09, 3:26 PM
    • #6
    • 1st Jan 09, 3:26 PM
    There's certianly a whole in the 'market' for this DRO. I'm guessing it will be people who have always been on a low income and haven't had the opportunity to mount up higher levels of debts that will benefit, the very same people who are not able to find the £495 fees needed for BR, especially those whose entire income is made up of benefits.

    There have certainly been a fair few members here for who this would be a lifeline.
    Accept your past without regret, handle your present with confidence and face your future without fear
  • startagain
    • #7
    • 1st Jan 09, 3:29 PM
    • #7
    • 1st Jan 09, 3:29 PM
    When I first heard about this I did think that it would be a good thing and will "help" a lot of people who are in desperate circumstances.
    I do worry though, and I am aware about glasshouses and stones, that this may make it easier for people not to worry about being in debt because there is an "easy way out".
    I guess it is up to the credit providers to be more vigilant in who they offer credit to and to have sensible credit limits ...... ( speaking from experience ) there is still too much raising of limits and credit being offered, especially by sub prime providers.
    IMHO :rolleyes:
    SA
    2011 - New year, New start, New me

    Planning on making my dreams a reality
  • k2nga
    • #8
    • 1st Jan 09, 3:34 PM
    • #8
    • 1st Jan 09, 3:34 PM
    thats the thing if the lenders were responsible then this would be a good thing but if they are not then i see your point.

    Is there a set date for this to come into effect?
    K2nga

    BSC Member 176
    BR 23/06/08
    ED 22/01/09
    Credit file BR fall off date: 24/06/14
    • debt doctor
    • By debt doctor 1st Jan 09, 3:38 PM
    • 3,914 Posts
    • 5,539 Thanks
    debt doctor
    • #9
    • 1st Jan 09, 3:38 PM
    • #9
    • 1st Jan 09, 3:38 PM
    As Peachy says, this is aimed at those who survive on low incomes, its the cost of BR that forces many in this social group to be at the mercy of DCA for a great length of time, only being able to offer £1 per month, sometimes for years. ( I had one client about 3 months ago that has been paying Nat west a £1 per month since 1983 !!

    DD
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
    • fiveyearplan
    • By fiveyearplan 1st Jan 09, 3:40 PM
    • 10,058 Posts
    • 9,947 Thanks
    fiveyearplan
    I think its a good idea - its like a 2 tier BR system. It certainly wouldn't have helped me but would have been useful for many others on here.

    Mortgage free by 2014


  • k2nga
    Yeah true it would not have helped me and with so many having debts in excess of 15k it still makes it hard for those deep in debt to pay the £495 needed to go BR.

    I was wondering the other day why they cannot allow you a crises loan to go BR is you met a certain criteria which would obvoiusly have to be paid back but might be easier for them in instalments
    K2nga

    BSC Member 176
    BR 23/06/08
    ED 22/01/09
    Credit file BR fall off date: 24/06/14
  • startagain
    Who will be processing these if it is not the courts......?

    I hope it wont be one of those beureacratic nightmares that we seem to be very good at in this country..... :rolleyes:

    thinking of the CSA, Tax Credits etc - we seem to be very good at launching new things without the systems or technology to deal with it properly.

    SA
    2011 - New year, New start, New me

    Planning on making my dreams a reality
    • debt doctor
    • By debt doctor 1st Jan 09, 4:01 PM
    • 3,914 Posts
    • 5,539 Thanks
    debt doctor
    Its processed directly between the intermediary (CAB etc) and the insolvency service, submitted on line.

    And.... the technology is not in place yet !

    DD
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
  • startagain
    Its processed directly between the intermediary (CAB etc) and the insolvency service, submitted on line.

    DD
    Originally posted by debt doctor

    That sounds like a good idea........ it is going to make the debt charities and CAB very,very busy....

    I hope they are going to get help from the government for extra funding.

    SA
    2011 - New year, New start, New me

    Planning on making my dreams a reality
  • k2nga
    Yeah i agree i have been having to use the CAB alot in fact i am a regular now but they are up to there necks as it is and there are always a people waiting in the waiting rooms for advice.
    K2nga

    BSC Member 176
    BR 23/06/08
    ED 22/01/09
    Credit file BR fall off date: 24/06/14
    • debt doctor
    • By debt doctor 1st Jan 09, 4:07 PM
    • 3,914 Posts
    • 5,539 Thanks
    debt doctor
    That sounds like a good idea........ it is going to make the debt charities and CAB very,very busy....

    I hope they are going to get help from the government for extra funding.

    SA
    Originally posted by startagain
    It is going to make us very busy as you say!! No extra funding is being given except that £10 out of the £90 fee goes to the money advice trust to provide training.

    Wow !

    DD
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
  • startagain
    Yet another day that I am counting my blessings for having found this board and got the support for filing for BR sooner rather than later.....
    2011 - New year, New start, New me

    Planning on making my dreams a reality
  • cr1
    Debt relief order (Debts under £15k) (merged)
    Hi all,

    I see there is lots of people going bankrupt with debts under £15,000 not sure if its been mentioned on here, basically in April goverment are looking to introduce a debt relief order that writes off debt upto £15k without a full blown bankruptcy, not sure if some of you can hold off until then!


    "Debt Relief Orders should allow people with debts of less than £15,000 and minimal assets or surplus income to write off debts without a full-blown bankruptcy."

    http://news.bbc.co.uk/1/hi/business/7805892.stm
    • fermi
    • By fermi 6th Jan 09, 11:16 AM
    • 39,030 Posts
    • 46,819 Thanks
    fermi
    debt doctor posted a thread on this a few days ago with quite a lot of info/detail.

    I'll find it and merge this thread with it. That should "bump" the other thread as well so everyone can see it.
    I'm a Board Guide on the Debt-Free Wannabe, Bankruptcy, Credit Cards and Loans boards. I'm a volunteer to help the boards run smoothly, and I can move and merge threads there. Any views are mine and not the official line of moneysavingexpert.com. Board guides are not moderators. If you spot an inappropriate or illegal post then please report it to forumteam@moneysavingexpert.com

    Free/impartial debt advice: National Debtline | StepChange Debt Charity | Find your local CAB

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  • cr1
    Thanks Fermi,

    Was trying to see if anyone mentioned it, sorry for stepping on anyones toes,
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