Debt Relief Orders (DRO) - Information & help thread

gspec312

immoral_angeluk wrote: »

You can't put the money down as annual income because it isn't. However, if you spend the money on getting the car (under 1k) roadworthy and spend it on essential domestic needs (ie car insurance, tax, repairs) then that would be ok as far as I would be concerned. Anything leftover would be an asset, not income so if over £300 would rule you out of a DRO.
But if you were declare it as this it would need to be the case that you actually did that and didn't just say it for the purposes of obtaining your DRO as that would be fraud.

Ok, how about if the car i bought came in at above £1000 or bought a share in my parents car and i paid insurance etc, but the car was not in my name, so i only owned say a 1/4 of the car? Would that be possible.

As i have had an offer to basically rent a car from my parents for the year, as long as I pay maintanance costs and insurance etc...how would that work?

FraudBuster

gspec312 wrote: »

Ok, how about if the car i bought came in at above £1000 or bought a share in my parents car and i paid insurance etc, but the car was not in my name, so i only owned say a 1/4 of the car? Would that be possible.

As i have had an offer to basically rent a car from my parents for the year, as long as I pay maintanance costs and insurance etc...how would that work?

I don't envy the authorised intermediary who ends up with this case on their desk.

poormummy_3

FraudBuster wrote: »

I don't envy the authorised intermediary who ends up with this case on their desk.

I don't envy the person who is in a difficult financial situation and trying really hard to discover the best solution when the information is difficult to find.

gspec312

Well lets just say this has left me in a much more difficult situation than i started with. I have £1900 from the insurance company, a car needs to be purchased this week, my meeting is tomorrow with the CAB intermediary, the money is probably going to be seen as an asset as i am yet to spend it on getting a car.

My parents have offered to buy a car that they will use when they return from France next year, I put a £1000 towards borrowing it off them for the year-18 months as they will pay any maintenance costs and then I pay my insurance and the tax for it, but im worried as to how this will seem to the intermediary....but if this is the case the car wont be mine but the insurance would be £700 for the year and the tax around £245 for the year, and there goes the money....any help?

wba31

gspec312 wrote: »

Well lets just say this has left me in a much more difficult situation than i started with. I have £1900 from the insurance company, a car needs to be purchased this week, my meeting is tomorrow with the CAB intermediary, the money is probably going to be seen as an asset as i am yet to spend it on getting a car.

My parents have offered to buy a car that they will use when they return from France next year, I put a £1000 towards borrowing it off them for the year-18 months as they will pay any maintenance costs and then I pay my insurance and the tax for it, but im worried as to how this will seem to the intermediary....but if this is the case the car wont be mine but the insurance would be £700 for the year and the tax around £245 for the year, and there goes the money....any help?

I would go against paying your parents to "lease" the car from them. That to me is simply disposing of an asset (the cash) and borrowing your parents car, something I see people do regularly for free.
If you are that desperate for the DRO, the only way around this is to buy a car for less than £1000 (if you buy one for more than £1000, then declare it as being worth less than £1000, im not sure how that would be seen as anything but ok!) as already said you can pay for essential repairs to make the car roadworthy, and then see how much you have left, and as said, still more than £300, I'm not sure this is going to be the best option for you

immoral_angeluk

gspec312 wrote: »

Ok, how about if the car i bought came in at above £1000 or bought a share in my parents car and i paid insurance etc, but the car was not in my name, so i only owned say a 1/4 of the car? Would that be possible.

As i have had an offer to basically rent a car from my parents for the year, as long as I pay maintanance costs and insurance etc...how would that work?

I think you're over complicating it really. You need to be careful of doing things which could be seen as depriving yourself of an asset in order to obtain a DRO. Theoretically there are many ways you could make yourself eligible for a DRO, but I think in your instance you should concentrate on finding the most suitable option for you in terms of having a vehicle for work, and then go from there. A DRO isn't the only debt option out there after all.

immoral_angeluk

gspec312 wrote: »

Well lets just say this has left me in a much more difficult situation than i started with. I have £1900 from the insurance company, a car needs to be purchased this week, my meeting is tomorrow with the CAB intermediary, the money is probably going to be seen as an asset as i am yet to spend it on getting a car.

My parents have offered to buy a car that they will use when they return from France next year, I put a £1000 towards borrowing it off them for the year-18 months as they will pay any maintenance costs and then I pay my insurance and the tax for it, but im worried as to how this will seem to the intermediary....but if this is the case the car wont be mine but the insurance would be £700 for the year and the tax around £245 for the year, and there goes the money....any help?

If you're going to essentially rent it for 1k and pay your own insurance etc (which is fine..) then ideally you need to draw up an agreement with them to that effect, clearly stating that it is rental for 1 yr only and that at no point will you own the car but that you are liable for tax/insurance/mot/etc during that time.

immoral_angeluk

wba31 wrote: »

I would go against paying your parents to "lease" the car from them. That to me is simply disposing of an asset (the cash) and borrowing your parents car, something I see people do regularly for free.
If you are that desperate for the DRO, the only way around this is to buy a car for less than £1000 (if you buy one for more than £1000, then declare it as being worth less than £1000, im not sure how that would be seen as anything but ok!) as already said you can pay for essential repairs to make the car roadworthy, and then see how much you have left, and as said, still more than £300, I'm not sure this is going to be the best option for you

This is pretty much my feeling on it.

The simpler it is, the less likely the OR would feel the need to look into it with a view to seeing if you've deprived yourself of an asset.

gspec312

Thankyou for all the reply's this week, the guy from the CAB i met today told me that my best options would be as followed:
To either buy the car for under £1000 and then buy an essential white good/s or laptop for uni etc and maybe some clothes...that would then satisfy as up to £1700 being spent leaving me with only £200 assets.

The other option he suggested was to lend the car from my parents and find some way of spending £1700 on essential objects like above.

Then the last option would be to get the car that is in my possession still( but written off ) repaired and road worthy but make sure I keep the invoices. Although I would be spending far more on the car than it is worth the way that this works out the dro will leave me far better off 2 years down the line.

Anyones thoughts on this?

wba31

gspec312 wrote: »

Thankyou for all the reply's this week, the guy from the CAB i met today told me that my best options would be as followed:
To either buy the car for under £1000 and then buy an essential white good/s or laptop for uni etc and maybe some clothes...that would then satisfy as up to £1700 being spent leaving me with only £200 assets.

The other option he suggested was to lend the car from my parents and find some way of spending £1700 on essential objects like above.

Then the last option would be to get the car that is in my possession still( but written off ) repaired and road worthy but make sure I keep the invoices. Although I would be spending far more on the car than it is worth the way that this works out the dro will leave me far better off 2 years down the line.

Anyones thoughts on this?

Getting a written off car road worthy and tested is a long and laborious process, a friend of mine did it and someone ploughed into the back of his car again 4 weeks after he got it back on the road so he just gave up on it.

I personally would be wary on "leasing" a vehicle from parents, although that is down to my opinion as an intermediary only. Immoral has a different opinion, and this comes down to us not actually getting many answers from the DRO Unit. for me your best option is buy a car for less than £1k, pay for essential repairs. With white goods I'd be careful buying anything you dont need, if you just fancy a bigger tv or louder stereo, might be hard to justify spending on that. If you need a new washing machine then that should be fine.
The other thing i missed in my last post to you, is should you be left with £800. You can keep £299, and you need £90 for your DRO fee. that leaves you with £411. If you simply split that pro rata between your creditors, then you would be fine to proceed with a DRO. it must be split fairly, so dont just pay off one small debt at £400 and give £11 to someone else, all debts must get a share of the remainder.
but as Immoral said, get a car, get it on the road, then see whats left and work it out from there