Debt Relief Orders (DRO) - Information & help thread

broken_spirit

fatbelly wrote: »

That's correct. Courts can refer to an Intermediary if someone has come to present a bankruptcy petition and they consider a DRO to be more appropriate. But it is a fundamental part of the DRO process that the courts should not be involved. Part of the reasoning behind their introduction was to take the pressure off the court system.

An Intermediary has to be appointed by a Competent Authority (CCCS, Payplan, CAB, CAP, ND etc) and so I can't see how a solicitor would be able to be one, nor why they would want to be (can't charge a fee!).

Anyone know how that works?

It was the Leeds CAB who referred me...........how it works exactly once u proceed with the solicitor.............I don't kno............I did have 2 sign a letter in my local CAB office, so that the benefits office would provide proof of my benefit awards, so that I could apply 4 legal aid...........I didn't like the sound of it, so didn't proceed any further. I'm sorry I can't shed anymore light on it.

cupcake83

rainbowfairydust wrote: »

My tax credits have not been renewed this year and now will (i say will as i have made my payments this month) snowball..would i be eligible for a dro?

eta - I owe around £8.5k


Income – 920.00

Rent - £260.00
Mobile £45.00
TV £12.37
Phone/Internet £11.25
Electric £45.00
Travel £45.00
Hair/Dental - £30.00
Work Clothes £20.00
Food/Toiletries £145.00
HMRC - £23.12
Housing Benefit £87.00
Vanquis £15.00
Capital One £5.00
New Look £5.00
Barclaycard £5.00
Clarity £5.00
Lowell £25.50
Mackenzie Hall £5.00
Real personal £25.00
Barclays Bank £20.00
Red Castle £5.00
Apex £15.00
The Money Shop £50.00
Hearing Aid £12.00
Parents £5.00


Total - £921.24

May be useful for you to complete a SOA using calculator at www.makesenseofcards.com. Then you can separate into sections income, expenditure and debts, thats what I've used to complete my mothers (see above) when completing a SOA to see whether you would be suitable for a DRO you not put your debt repayments in the outgoing section as the £50 per month excess your allowed would be before debt repayments. It appears from your SOA above that if you took out the payments to your creditors such as Barclaycard, Capital One etc. would have over £50 left over per month.

MoneySpendingEejit

My apologies to all who have responded since my last post, I only remembered to check back in today.

I can only presume that the solicitor is authorised to do this, he has told me that we'll have to do the whole application online (at my appointment this Friday) and that I'll need to allow a good couple of hours. I believe the costs are being covered by Legal Aid? I'll be honest, my understanding is basic and I'm simply doing as instructed by the CAB!! They asked me to complete and send back a budget form when I first contacted them, and it was when they saw the results that they simply said they would make me an appointment with the solicitors.

I was asked to post my S.O.A, so I'll do that now, based on the forms I received back from the solicitor at the weekend (I was told it would have to all be clearly written up for me to thoroughly read over before I proceed).

Oh, there wasn't a S.O.A summary in here! I'll have to recall it from memory:

Rent: £600 pcm, paid four weekly. Currently paid in full, four weekly, by Housing Benefit of £553.84.
Council Tax: Will edit with exact amount (it's £13.xx per week), currently paid in full by Council Tax Benefit.

This income/expediture cancels itself out, so I've separated it.

---

Other Income -

Income Support: £183.36 per fortnight £366.72 p/m)

Outgoings -

Shopping budget: £35 per week (£140 p/m)

Electricity: £25 per fortnight (£50 p/m) - may need to slightly increase this though, on key meter and Scottish Power have just started recovering a debt at a rate of £3.40 per week (because they apparently 'forgot' to do so when it was first installed 13 months ago), plus price increases commence in August. Although in saying that, presumably the debt would be removed with the DRO?

Landline: £6 per month. On BT Basic, plus small allowance for calls not included in allowance (084/087 calls, usually).

Internet: £21.50 per month. Admittedly, I'm on a higher tier package, but locked into that until next May irregardless. Don't particularly want to change either because as soon as I do, I'll be put on o2's new traffic managed packages which will severely impact my speeds.

TV License: £37 approx per quarter (£12.35 per month)

Mobile Phone: £35 per month - Contract is £30 per month, but don't always have funds in the account on billing day, which means I have to cancel debit and incur a £3 non-DD fee. Plus small allowance for chargeable calls, usually voicemail retrieval. I try to keep it as close to £30 whenever possible though.

Travel: £25 per month. Bus travel, required to get around.

Gym: £31.50 per month - currently in the process of trying to improve my health and lose a considerable amount of weight. Swimming five days a week and it is working, so I consider this a necessity. Will they?

Slimming Club: £4.95 per week (£19.80 per month) - the same, part of my current self-improvement and not something I can really afford to foresake.

This leaves me with £22.57 per month (I think I might be missing something, will have to review), no clothing budget and a tight shopping budget (I'm finding that eating healthily doesn't necessarily come cheap!! )

Oh, I get my hair cut once every couple of months, which comes to around £15 (with a small tip). If I factor in £7.50 a month for haircuts, plus the suggested £5 (per week or month?) budget for clothing, I'm already into negatives. This is as honest an account of my finances as I can make right now, I'm not even tipping certain things in my favour. I did have two magazines I like to read subscribed with my newsagent, but I cancelled those as I decided they were an extra £7 a month I could do with not spending!!

scarlet55

dannyb0yuk wrote: »

My apologies to all who have responded since my last post, I only remembered to check back in today.

I can only presume that the solicitor is authorised to do this, he has told me that we'll have to do the whole application online (at my appointment this Friday) and that I'll need to allow a good couple of hours. I believe the costs are being covered by Legal Aid? I'll be honest, my understanding is basic and I'm simply doing as instructed by the CAB!! They asked me to complete and send back a budget form when I first contacted them, and it was when they saw the results that they simply said they would make me an appointment with the solicitors.

I was asked to post my S.O.A, so I'll do that now, based on the forms I received back from the solicitor at the weekend (I was told it would have to all be clearly written up for me to thoroughly read over before I proceed).

Oh, there wasn't a S.O.A summary in here! I'll have to recall it from memory:

Rent: £600 pcm, paid four weekly. Currently paid in full, four weekly, by Housing Benefit of £553.84.
Council Tax: Will edit with exact amount (it's £13.xx per week), currently paid in full by Council Tax Benefit.

This income/expediture cancels itself out, so I've separated it.

---

Other Income -

Income Support: £183.36 per fortnight £366.72 p/m)

Outgoings -

Shopping budget: £35 per week (£140 p/m)

Electricity: £25 per fortnight (£50 p/m) - may need to slightly increase this though, on key meter and Scottish Power have just started recovering a debt at a rate of £3.40 per week (because they apparently 'forgot' to do so when it was first installed 13 months ago), plus price increases commence in August. Although in saying that, presumably the debt would be removed with the DRO?

Landline: £6 per month. On BT Basic, plus small allowance for calls not included in allowance (084/087 calls, usually).

Internet: £21.50 per month. Admittedly, I'm on a higher tier package, but locked into that until next May irregardless. Don't particularly want to change either because as soon as I do, I'll be put on o2's new traffic managed packages which will severely impact my speeds.

TV License: £37 approx per quarter (£12.35 per month)

Mobile Phone: £35 per month - Contract is £30 per month, but don't always have funds in the account on billing day, which means I have to cancel debit and incur a £3 non-DD fee. Plus small allowance for chargeable calls, usually voicemail retrieval. I try to keep it as close to £30 whenever possible though.

Travel: £25 per month. Bus travel, required to get around.

Gym: £31.50 per month - currently in the process of trying to improve my health and lose a considerable amount of weight. Swimming five days a week and it is working, so I consider this a necessity. Will they?

Slimming Club: £4.95 per week (£19.80 per month) - the same, part of my current self-improvement and not something I can really afford to foresake.

This leaves me with £22.57 per month (I think I might be missing something, will have to review), no clothing budget and a tight shopping budget (I'm finding that eating healthily doesn't necessarily come cheap!! )

Oh, I get my hair cut once every couple of months, which comes to around £15 (with a small tip). If I factor in £7.50 a month for haircuts, plus the suggested £5 (per week or month?) budget for clothing, I'm already into negatives. This is as honest an account of my finances as I can make right now, I'm not even tipping certain things in my favour. I did have two magazines I like to read subscribed with my newsagent, but I cancelled those as I decided they were an extra £7 a month I could do with not spending!!

i think you cud easily put down extra for food......unlikely that you will be able to put down gym or swimming as the or wont see this as a neccesity.....and he might even say that what you spend here can be used for debt repayment.....you will have to factor this money elsewhere im afraid.....as i said you could put extra on your shopping.......

scarlet55

rainbowfairydust wrote: »

My tax credits have not been renewed this year and now will (i say will as i have made my payments this month) snowball..would i be eligible for a dro?

eta - I owe around £8.5k


Income – 920.00

Rent - £260.00
Mobile £45.00
TV £12.37
Phone/Internet £11.25
Electric £45.00
Travel £45.00
Hair/Dental - £30.00
Work Clothes £20.00
Food/Toiletries £145.00
HMRC - £23.12
Housing Benefit £87.00
Vanquis £15.00
Capital One £5.00
New Look £5.00
Barclaycard £5.00
Clarity £5.00
Lowell £25.50
Mackenzie Hall £5.00
Real personal £25.00
Barclays Bank £20.00
Red Castle £5.00
Apex £15.00
The Money Shop £50.00
Hearing Aid £12.00
Parents £5.00


Total - £921.24

hi rainbow....you need to redo your soa WITHOUT the debts listed....as this is what you will be living on iff you are granted a dro....obviously you wont be making any debt repayments then........iff your total expenditure without your debts comes to just over £600, then as far as i can see this leaves you with just over £300 and you wont be able to do a dro........with a dro you have to put down everything you pay out monthly (excluding debts) and have less than £50 surplus left with which to pay your creditors....

MoneySpendingEejit

scarlet55 wrote: »

i think you cud easily put down extra for food......unlikely that you will be able to put down gym or swimming as the or wont see this as a neccesity.....and he might even say that what you spend here can be used for debt repayment.....you will have to factor this money elsewhere im afraid.....as i said you could put extra on your shopping.......

Well I'd need to add £12.83 to my shopping budget to incorporate the gym/slimming world expenditure- so is a round £50 a week still a reasonable figure for a single male?

fatbelly

MoneySpendingEejit wrote: »

Well I'd need to add £12.83 to my shopping budget to incorporate the gym/slimming world expenditure- so is a round £50 a week still a reasonable figure for a single male?

Yep - well within the trigger figure for housekeeping.

MoneySpendingEejit

fatbelly wrote: »

Yep - well within the trigger figure for housekeeping.

Thanks fatbelly, both yours and scarlet's help is very much appreciated

I just need to try and do a hypothetical S.O.A now for if I was to return to work.

Working 30 hours a week (which is what I imagine it would be now, as I don't think they can justify 40 anymore) at £6 per hour would be a basic £180 per week before tax. According to a tax calculator website (admittedly, I have no idea what my tax code is), I'd take home £167.83 per week.

If I get this 'In Work Credit' of £40 per week, how would this affect things? I would essentially be £160 better off per month for a year, but after that year I'd suddenly be £160 worse off each month. How would this work with regards to the DRO?

According to the WTC site, I'd be entitled to £2,037.75 in Working Tax Credits until April 5th 2012 if I started a claim on 6th July 2011 (date had to be within the next seven days, so again a hypothetical)- and I seriously think I'm doing something wrong there. That amount seems ludicrous, but it says it's based on my household income of £0.00. None of the questions ask me to include any of my Income Support, so is it actually correct that my household income for the previous year would in fact be zero? This bit, I just can't fathom. Even as an amount for the entire year, it seems a lot at £40 per week?

Housing Benefit would (if I was receiving Working Tax Credits of £39.17 a week, worked out by dividing that £2,037 by 52) pay £65.35 per week towards my rent. If I was receiving no Working Tax Credits, they'd pay £90.81 per week.

So, my total income every four weeks would be (312.35 weekly) £1249.40 (for the £40 per week Working Tax Credits scenario) - and then £1089.40 after the year of In Work Credit was over.

minus

Rent - £553.84 every four weeks

Council Tax - £13.96 per week (£55.84 every four weeks)

Shopping budget: £50 per week (£200 every four weeks)

Electricity: £25 per fortnight (£50 every four weeks)
Landline: £13.90 per month. (£12.83 every four weeks) (no longer entitled to BT Basic rates)

Internet: £21.50 per month. (£19.85 every four weeks)

TV License: £37 approx per quarter (£11.40 every four weeks)

Mobile Phone: £35 per month (£32.31 every four weeks)

Travel: £68.40 per month (monthly bus pass, no longer possess half price Oyster fares)

Those figures leave me with £244.93 for the first 52 weeks, then £84.93 thereafter.

or

(£298.64 weekly) £1194.56 (for the zero Working Tax Credits scenario) - and then £1034.56 after the year of In Work Credit was over.

Those figures leave me with £190.09 for the first 52 weeks, then £30.09 therafter.

And if I've indeed worked out my WTC incorrectly, then presumably my figures would fall somewhere between these sets of hypotheticals. The problem of course is that for the first year at least, even if I raise certain figures (shopping/clothing budgets, presumably) I'd have a hard time making my disposable income under £50 per month and have no choice but to start repaying- but then after a year I'd likely fall under the £50 threshold!!! :rotfl:

Grrr, this is complicated business. I'm glad I've at least got these figures laid down though.

LouR

Hi, I was accepted for a DRO on 02/ AUG /2010 and have a few question that are worrying me..

I'm still receiving threatening letters from a collection agency stating they are considering sending a doorstep colloector. What happend if they come to my home after the DRO is ended? I thought they would have been notified I'm on a DRO.

Does my DRO end in August or do I have to wait another 3 months?

Are my debts wiped after August or not?

Will I get a letter or have to send one to the OR confirming the DRO end?

What happens if I pay a debt that was listed, after the DRO ends.. will it forfeit the DRO and again make me liable to pay ALL debts?

To be honest, I can't see my debts being cleared after 12 months as it seems too good to be true.. are DRO's revoked regularly?

Thanks for your help this last year, you've taken a great weight off of my shoulders. Just getting nervous now

Lou

scarlet55

LouR wrote: »

Hi, I was accepted for a DRO on 02/ AUG /2010 and have a few question that are worrying me..

I'm still receiving threatening letters from a collection agency stating they are considering sending a doorstep colloector. What happend if they come to my home after the DRO is ended? I thought they would have been notified I'm on a DRO.

Does my DRO end in August or do I have to wait another 3 months?

Are my debts wiped after August or not?

Will I get a letter or have to send one to the OR confirming the DRO end?

What happens if I pay a debt that was listed, after the DRO ends.. will it forfeit the DRO and again make me liable to pay ALL debts?

To be honest, I can't see my debts being cleared after 12 months as it seems too good to be true.. are DRO's revoked regularly?

Thanks for your help this last year, you've taken a great weight off of my shoulders. Just getting nervous now

Lou

your dro will end on the 2nd of august and all debts will be cleared, you wont recieve any notification of the dro ending, but it will tell you on the insolvency register....you cant pay your debts after the dro as they will all be cleared as i said...send the collection agency a copy of your dro and tell them they are breaking the law and iff they have any queries to get in touch with the OR....who will have pretty strong words for them im sure....this collection agency has probably bought this debt from one of your creditors, unaware that there is a dro in place.....it may seem too good to be true.....but it is true....dont worry, its nearly over for you, well done....:):)