Debt Relief Orders (DRO) - Information & help thread

debt_doctor

Hi all,

Sorry I've not been around much, I will be back!

Just to let you all know that there is to be an 'important announcement' re DRO's and pensions on the 19th November 2010, Hope it's good news.

DD

debt_doctor

Good early news !!!!!:beer:

From April 2011, Pensions in DRO's are to be treated the same as in bankruptcy ie it will be exempt as an asset if HMRC approved.:j

DD

fermi

Just seen that. Very good news.

http://nds.coi.gov.uk/content/detail.aspx?NewsAreaId=2&ReleaseID=416467

Edward Davey, Minister for Employment Relations, Consumer and Postal Affairs, today announced proposals to reform the Debt Relief Order (DRO) regime. The changes will allow debtors with an approved pension access to the DRO procedure.

Making the announcement Edward Davey said:

“This is good news for some of the most needy and vulnerable members of society who find themselves in inescapable financial difficulties. It is an important change. To deny people access to Debt Relief Orders because they have accrued some rights to a pension that they cannot yet access is simply unfair.”

The announcement follows a consultation launched in March this year, following debt advice agencies expressing concerns that DROs, (launched in April 2009), excluded some vulnerable people struggling with small debts. These debtors could not access the scheme because they had some pension rights, often of small value and not receivable for many years. The proposals will change the rules to allow those with rights to approved pensions access to DROs.

Commenting on forthcoming change Sue Edwards, Head of Consumer Policy at Citizens Advice said:

"We warmly welcome this announcement which will benefit those who fulfil most of the criteria for a DRO yet who were having their applications rejected because of very small pension funds, something that has been of great concern to us. However it is crucial that funding for face to face debt advice is continued if the most vulnerable people are to benefit.”

Malcolm Hurlston, Chair of the Consumer Credit Counselling Service said:

"For everybody in debt there needs to be a solution and the Debt Relief Order has already proved right for many of the least well off.

"We are delighted the Coalition government had moved swiftly to remove an anomaly which will open up the right solution to many more thousands of people in need."

DROs were introduced in April 2009 following research that identified that there were people in long term debt difficulties who had nothing to offer their creditors and who could not afford to make themselves bankrupt. Delivered in partnership with the professional debt advice sector, DROs provide low cost, easy access to debt relief for those overwhelmed by relatively low levels of unmanageable debt. They are designed to provide a fresh start for the most vulnerable people trapped in debt.

To use the DRO procedure individuals must meet a strict eligibility criteria of having assets valued at less than £300, debts no more than £15,000 and surplus income of less than £50 per month. Currently, if someone has a pension that is worth over £300, they are not eligible to apply, even if the pension is not receivable for many years.
The full Debt Relief Order Initial Evaluation Report can be viewed at:-
http://www.insolvency.gov.uk/insolvencyprofessionandlegislation/con_doc_register/DRO%20interim%20evaluation%20report%20-FINAL.pdf

immoral_angeluk

Bout time too!

sarah_barker

i've just reached the end of my moratorium period and was therefore discharged yesterday from all my debts. what should i be looking to do now in terms of rebuilding my credit etc?

SingleMumOf2_3

argh... my dro STILL hasnt gone through ive applied to university to start sept 2011.. but ill still be in my dro period.. does that mean ive wasted my time applying? im so annoyed at cab been waiting ages and been treated like im mithering everytime i phone. just fed up now!

Orville

SingleMumOf2 wrote: »

argh... my dro STILL hasnt gone through ive applied to university to start sept 2011.. but ill still be in my dro period.. does that mean ive wasted my time applying? im so annoyed at cab been waiting ages and been treated like im mithering everytime i phone. just fed up now!

Well why has it not gone through..? What is the holdup.?

Why would going to uni affect your DRO...?

SingleMumOf2_3

because id get bursarys and loans and things, id have no idea to work it out so it was acceptable for dro. it was on hold since feb because my name was on a joint bank account. i managed to get it all sorted and signed the final bit of the dro 2 months ago. cab said it would take 48hrs to go through. since then they just keep saying the system is down. but im getting more and more threatening letters and people knocking at my door. and the longer it holds out the long im going to be struggling in the dro period.

Orville

SingleMumOf2 wrote: »

because id get bursarys and loans and things, id have no idea to work it out so it was acceptable for dro. it was on hold since feb because my name was on a joint bank account. i managed to get it all sorted and signed the final bit of the dro 2 months ago. cab said it would take 48hrs to go through. since then they just keep saying the system is down. but im getting more and more threatening letters and people knocking at my door. and the longer it holds out the long im going to be struggling in the dro period.

Well as far as i am aware the systems are working fine, maybe fatbelly or immoral or shed some light into that. If i were you i would write a letter of complaint and send it in recorded asap demanding a response and action be taken to process the DRO fortwith. as for uni expences etc, i can't shed any light onto that sorry.

Diddley_Squat

Hi

Could someone help me please?

If you receive money from a loved one who has passed on and you spend it doing up your home which is something you would normally find impossible to do as you are basically working just to keep a roof over your head and are not in receipt of any benefits, and you apply for a Debt Relief Order as you have outstanding debts, would the fact that the inheritance money has now all gone affect your application for the DRO? Would you need to declare it?

I apologise if this doesn't make sense. Can anyone help at all?

Many thanks.