Debt Relief Orders (DRO) - Information & help thread

imatt

Hi, decided to go through with a DRO. Sent the paperwork in a few weks ago. Phoned CCCS a couple of days ago and was told it could take a few more weeks!!!!!! I've been advised to make token payments in the meantime.

Are they (CCCS) not supposed to contact one's creditors? I have had a letter from one and keep getting phone calls from another (Barclycard). Is there a way to stop these calls? Perhaps i should phone them up, tell them I'm being advised by CCCS and tell them I'm taking out a DRO? What does anyone else think of this?

imatt

SimIsOnTheUp

Hiya guys.

I am so stressed about what to do, regarding my debts, it's untrue.

Having been to discuss things with a very helpful lady, at the CAB yesterday, I've decided to go for a DRO.

I really don't want to go down the DRO route, however I don't really have a choice.

My huge worry though, is the possibility of being 'done' for fraud :-/

2 weeks ago, I stupidly wrote 5 cheques out, at 'The Money Shop', totalling £500 (one of those 'cash 'til payday' loans)..

I lied at the time, and said I was still working in my old job (which I lost last November '09 / been on ESA since), when I wrote the cheques at 'The Money Shop', giving them my old works address / bank account / Visa debit card and cheque guarantee card details.

Stupid, I realise.

I'm a recovering alcoholic, and have been going through severe depression and anxiety, and fell off the wagon when I did this 2 weeks back, having since got help and climbed back on.

So, my worry now, is that I'm in such a pickle with my debts, I just can not think straight.

The Money Shop are going to present the cheques (£500 worth) to my bank (Alliance & Leicester), on the 8th July, and the money is not going to be there in the account.

I wasn't sure, if the cheques would bounce, or if they would be 'guaranteed' with the card, and so the CAB lady called the A & L bank on behalf of an anonymous client.

The A & L said, that the cheques would indeed be 'honoured', and so my account will go overdrawn, to the tune of £500 + bank charges (probably £25 I think for each cheque + £5 per day for being o / d)

My Girlfriend was going to lend me the £500 - deposit it into my A & L account, making sure that The Money Shop get there £500 back, and that my A & L account is safe / not overdrawn / no charges incurred.

However, having spoken to the CAB, it appears I'm now in even more of a quandry.

If I pay off The Money Shop / A&L, and then subsequently, have to go for a Debt Relief Order, the Official Receiver will then see that I have 'shown preferential treatment toward one creditor over another'.. The DRO would then apparently, be revoked.

Any of you with any experience / knowledge of this on here please - Is this true?

My debts amount to about £11,000 (all unsecured - no assets - rent flat - no car - out of work and on ESA), and so I was told by the CAB yesterday, that yes, I am eligible for the DRO.

We went through all the figures, and the angel of a Woman said that the worst case scenario regarding The Money Shop / A&L bank, will be that The Money Shop get repaid their £500 loan, and the bank overdraft / charges will then be treated as a seperate debt - which can then be included in my DRO, and written off after 12 months.

I am so worried though, that the A&L bank will then come after me for Fraud. Surely they will see, that I obviously wrote the cheques, knowing the funds would not be in my account to cover them. Will I then be looking at criminal proceedings / a jail sentence? I could not sleep last night, because of all this.

Even if the bank 'bounce' the cheques, The Money Shop will still chase me for the money back, and they too (more likely them) will come after me for fraud.

Either the bank or the Money Shop, are going to wonder, why I could afford the loan 2 weeks ago, and then a month later why I'm going to a Debt Relief Order. Surely this is going to arouse suspicion?

How on earth do I sort this out?

My other 'Priority Debts' are - Severn Trent Water (CCJ suspended, pending £45 a month / first payment due in 10 days time - I can't afford this) = £225.00

Also - NPower Electric Arrears = £635 - They are asking for direct payments, from my ESA each fortnight, of £15.30 - again, I will not be able to afford this, until I'm back into work.

TV License Arrears = approx £118 owing - again, I can not afford to repay this at present.

DWP Crisis Loans = £710 owing - the DWP are deducting £7.72 from my ESA - yet more deductions I can not afford.

Council Tax arrears = £459 (Liability Order already been granted) - the Council are wanting documents back from the CAB, to agree to £3.25 a week - more deductions from my ESA..

I also owe £2,333.24 to the Council, for a Housing Benefit Overpayment - this was 'coded fraud', and so will not be allowed to be included in the DRO - I will continue repaying this at £5 a week.

On top of these debts, I owe £20,784.99 in unsecured debts to my Creditors (Girlfriend / Credit Cards / Catalogues / old mobile contracts) - This also included £13,938.00 of Student Loans though, so it would be £6,846.99 included in the DRO..

Plus the £4,483.88 owing to the Priority Debts

= a Total Owed / to be included in the DRO = £11,330.87

So, obviously I am below the £15,000 limit for a DRO.

This is so tough to face, however I realise I can not repay all of this debt, given that my income is only £57.73 per week (after deducting £7.72 weekly towards repaying the Social Fund Loans to the DWP).

I just can't believe I've been so stupid :-/

Also, if I do go for a DRO (am thinking about going for it in the next couple of weeks), won't this then attract attention to the fraud I committed, regarding The Money Shop / Alliance & Leicester bank.

I really don't want to lose my A&L bank account either - this is the first account I have had in years..

I am aware though, that this account will probably be close anyway, once / if it goes £600 / 700 into the red..

I do have another seperate basic bank account with the Co - op - I've had this 6 years, and have treated the account well.

Am just so worried I'm going to end up in the Magistrates Court for my wrongdoing at The Money Shop, once they either don't get their money, or the bank lose their money..

Sorry to witter on here, but it's all making me feel quite ill, and I'm trying to get better, so I can return to work and make a fresh start.

Any pointers would be most appreciated.

Many Thanks,

Sim.

fatbelly

SimIsOnTheUp wrote: »

TV License Arrears = approx £118 owing - again, I can not afford to repay this at present.

Not included in a DRO, I think

SimIsOnTheUp wrote: »

DWP Crisis Loans = £710 owing - the DWP are deducting £7.72 from my ESA - yet more deductions I can not afford.

Included, but DWP have said they will continue to take from benefit during the morotorium period so you're going to repay half that.

A DRO does look like a good option for you - best move income/essential direct debits to the Co-Op account and then pay your £90 fee.

The A&L overdraft must go in your DRO.

Lee_m

Hi All,

Finally took the plunge and looked at our situation (which is a real mess). We owe nearly £14k (about 11k is in my name). We are both in receipt of benefits. In addition my husband receives DLA (due to physical and mental health issues) and uses almost the full amount for alternative therapies and his other medical needs. The rest goes towards housekeeping. He is also a heavy smoker and has tried to give up many times before.

Can any helpful soul who knows about DRO's please answer the following:

What documentary evidence do I need from start to finish for a DRO? Will they ask to see bank statements, receipts, etc? The reason I ask is because the therapist who treats my husband gives him a reduced rate as he pays in cash.

Is tobacco considered an acceptable allowance?

All replies are valued, thanks in advance.

normalnigel_2

Hi all here's a quick poser,

I'm in receipt of housing benefit that I also received an overpayment for.They are taking this overpayment back as a percentage from the housing benefit I now receive (their !!!! up!) any how they now want it back and no - I cant prove their error. So as the law stands I must cough up. SO....
Im considering a DRO. My question is this though - how will I add the HB payment to the list of creditors etc if my repayment is already tied into my benefit amount received? Or is it simply a case of informing them, stopping that claim, and making a new claim (no doubt with them "accidentally" dragging their heels)?

Also, I have read about the list of "assets" for the DRO, where do my childrens laptops etc etc stand as these total over £300 I would say. Is it really a case of itemising every piece of any value in the house? Car is knackered so Im ok there. I Think Im left with around £50 - £100/month after bills etc ( I will be by the time the form is filled out!)
Lastly , my partner receives maintenance from her ex. Am I right in saying this counts as income?
thanks for any advice.

SimIsOnTheUp

Lee_m wrote: »

Hi All,

Finally took the plunge and looked at our situation (which is a real mess). We owe nearly £14k (about 11k is in my name). We are both in receipt of benefits. In addition my husband receives DLA (due to physical and mental health issues) and uses almost the full amount for alternative therapies and his other medical needs. The rest goes towards housekeeping. He is also a heavy smoker and has tried to give up many times before.

Can any helpful soul who knows about DRO's please answer the following:

What documentary evidence do I need from start to finish for a DRO? Will they ask to see bank statements, receipts, etc? The reason I ask is because the therapist who treats my husband gives him a reduced rate as he pays in cash.

Is tobacco considered an acceptable allowance?

All replies are valued, thanks in advance.

Hi,

Whoever you go through, for your DRO - National Debtline / CAB etc, will want to see your paperwork / bank statements / proof of income / statements from your creditors, as will the Official Receiver, at the Insolvency Service.

Could your husband get receipts, from the therapist?

I would contact the CAB, and ask them, if tobacco is considered ok.

They have been very helpful, with me!

Good Luck,

Sim.

SimIsOnTheUp

normalnigel wrote: »

Hi all here's a quick poser,

I'm in receipt of housing benefit that I also received an overpayment for.They are taking this overpayment back as a percentage from the housing benefit I now receive (their !!!! up!) any how they now want it back and no - I cant prove their error. So as the law stands I must cough up. SO....
Im considering a DRO. My question is this though - how will I add the HB payment to the list of creditors etc if my repayment is already tied into my benefit amount received? Or is it simply a case of informing them, stopping that claim, and making a new claim (no doubt with them "accidentally" dragging their heels)?

Also, I have read about the list of "assets" for the DRO, where do my childrens laptops etc etc stand as these total over £300 I would say. Is it really a case of itemising every piece of any value in the house? Car is knackered so Im ok there. I Think Im left with around £50 - £100/month after bills etc ( I will be by the time the form is filled out!)
Lastly , my partner receives maintenance from her ex. Am I right in saying this counts as income?
thanks for any advice.

Hiya normalnigel.

Re your HB Overpayment - how has your Council 'coded' the Overpayment?

First thing to do, is call them and ask.

I was advised by the CAB, that Benefit Overpayments, can be included in the DRO.

However, the Overpayment will be excluded from the DRO, if there has been any evidence of fraud - ie - if you were 'interviewed under caution' (as I was )

Re your Council's procedure, I would contact them directly, and ask the CAB for some advice too.

Your childrens laptops, will not be touched - I don't think - not 100% though, so check with the CAB.

Once all bills are paid, you're allowed a maximum of £50 per month 'disposable income'.

I'm not sure, re your partners maintenance payments. Again, the CAB will help confirm this.

Good Luck to you.

Sim.

~evanesco~

I've not read through the whole thread, but I had been offered this option by CCCS. However, I have juggled my budget and will be embarking on a DMP with them instead. My reason being, I'm hoping my situation will be short term. OH has had to leave work, I've just changed jobs, council are taking ages sorting out HB/CTB. So there is very little income actually coming in at this present time, I felt that though this was obviously an option open to us, once things are settled, we'll be in a position to start making proper payments again, and should OH find a job, then everything will settle back to normal. To me this was too much of an easy way out if that makes sense. We got here by living the life of Riley, and while we could easily afford all our repayments, and save for other things too, we now can't. I'm glad these have been brought in, they're similar to the Administration Orders, and are a good thing for those who qualify. I was a borderline case for one, but I'd like to show my creditors that I am committed to repaying what I owe them, rather than have it written off.

normalnigel_2

SimIsOnTheUp wrote: »

Hiya normalnigel.

Re your HB Overpayment - how has your Council 'coded' the Overpayment?

First thing to do, is call them and ask.

I was advised by the CAB, that Benefit Overpayments, can be included in the DRO.

However, the Overpayment will be excluded from the DRO, if there has been any evidence of fraud - ie - if you were 'interviewed under caution' (as I was )

Re your Council's procedure, I would contact them directly, and ask the CAB for some advice too.

Your childrens laptops, will not be touched - I don't think - not 100% though, so check with the CAB.

Once all bills are paid, you're allowed a maximum of £50 per month 'disposable income'.

I'm not sure, re your partners maintenance payments. Again, the CAB will help confirm this.

Good Luck to you.

Sim.

Hi thanks for that-

to answer your HB question -I dont think its a fraud code?? dont remember any mention of that. Never got interviewed?
I appealed via a tribunal over the repayment decision but lost so have to repay. Genuine mistake.....by them:mad:
My only real concern with the DRO process is that the OR can deem "reckless" activity as a reason to refuse DRO.

So therfore, in the case of my HB overpayment - I didnt notice the overpayment (small amount over time) The law states its my duty to basically montior this amount and I didnt so its MY FAULT?:eek:
Right or wrong, I feel that because the tribunal found me liable the OR may deem this as a "reckless" debt....so no party.???

elfieb

normalnigel wrote: »

My only real concern with the DRO process is that the OR can deem "reckless" activity as a reason to refuse DRO.

More likely to result in a DRO Restriction rather than refusal