Debt Relief Orders (DRO) - Information & help thread

wba31

TheLegendOfMart wrote: »

It's worth over £300 second hand, I guess I'd have to get rid of it then?

What about the items that were purchased in my name using my bank account but my fathers money where he puts his wages?

I'd seriously question the value of a 2nd hand PC. The only computers that I know have a considerable 2nd hand value are macs due to them being very difficult to infect with virus and trojans, but if you have owned your PC for any length of time and have connected it to the internet, i would personally only argue it as component value (monitor £40, mouse £10, keyboard £10) etc etc

TheLegendOfMart

Thanks, how do I prove what assets I have?

Will they need to see receipts or anything?

National_Debtline

TheLegendOfMart wrote: »

Thanks, how do I prove what assets I have?

Will they need to see receipts or anything?

Hi again

Remember that you are only expected to declare assets if they have a collective value of over £300. Below that level, nothing to declare.

If you own something which isn't as straightforward to value as a 2nd hand car, and which may exceed the £300 asset value limit, the intermediary handling your application will normally make suggestions based on the precise circumstances. For a computer, that might mean getting 2-3 quotes from local PC dealerships, and/or seeing what comparable items are fetching on auction sites.

Without getting into tech specs (I'm no IT expert!), what exactly gives you reason to value the computer at over £300, given that it is 2nd hand and the risk of viruses etc. Is it a completely objective valuation and is there someone out there prepared to pay >£300 for it?

Regards

Dennis
Twitter: @natdebtline

TheLegendOfMart

It's another one of those bought in my name but not with my money by my father who has money in our joint bank account, it was bought as a present.

It was bought in Feb as a late xmas present for me and cost £750. I know electronics don't hold their value but it is worth more than £300 second hand.

I can't prove that I didn't buy it as it is all in my name.

National_Debtline

TheLegendOfMart wrote: »

It's another one of those bought in my name but not with my money by my father who has money in our joint bank account, it was bought as a present.

It was bought in Feb as a late xmas present for me and cost £750. I know electronics don't hold their value but it is worth more than £300 second hand.

I can't prove that I didn't buy it as it is all in my name.

If you are adamant that an item is worth >£300 but wish to pursue a DRO, then one option would be to trade in the item for a cheaper equivalent i.e. one worth <£300. As long as any surplus cash from the trade-in was used to pay off any "priority debts" e.g. rent/utility arrears, or was paid towards your creditors on a pro-rata basis, the result should be that you then meet the DRO criteria.

In such a scenario, it would obviously be essential to keep a paper trail of what you had done.

Regards

Dennis
Twitter: @natdebtline

hear_me_roar

Hello, I would like some advise please as I am struggling to find an answer to my question.

I I'm on ESA Support group and have been awarded my claim until November 2016 to which I will be reviewed. An have been backdated £1060.

I'm not on a DRO though given my financial circumstances and having £3000 of debts I am unable to make payment on, I think it would be the best solution for me.

I have no assets of over £300, no car, my monthly expenditure sometimes exceeds my income and I am currently living in housing association accommodation.

My question is, how would the lump sum of backdated ESA affect my DRO claim? In the past months, I've had to sell my washing machine and other items to keep myself afloat and in the coming months I will be undergoing therapy which will require me to gain a taxi and from due to slight agrophobia, being unable to use Public Transport and this Therapy usually lasts 12 months. These costs will put my expenditure higher than my income and in honesty would be what the backdated ESA payments would be paying for. Would this be taken into consideration on a DRO application?

Or would they reject me due to the lump sum?

I tried to use the debt remedy tool with StepChange and it said to make token payments as my financial situation is expected to change in the next 12 months. When if anything, for over the next 12months, nothing will change.

So confused, please can anyone advise.

wba31

hear_me_roar wrote: »

Hello, I would like some advise please as I am struggling to find an answer to my question.

I I'm on ESA Support group and have been awarded my claim until November 2016 to which I will be reviewed. An have been backdated £1060.

I'm not on a DRO though given my financial circumstances and having £3000 of debts I am unable to make payment on, I think it would be the best solution for me.

I have no assets of over £300, no car, my monthly expenditure sometimes exceeds my income and I am currently living in housing association accommodation.

My question is, how would the lump sum of backdated ESA affect my DRO claim? In the past months, I've had to sell my washing machine and other items to keep myself afloat and in the coming months I will be undergoing therapy which will require me to gain a taxi and from due to slight agrophobia, being unable to use Public Transport and this Therapy usually lasts 12 months. These costs will put my expenditure higher than my income and in honesty would be what the backdated ESA payments would be paying for. Would this be taken into consideration on a DRO application?

Or would they reject me due to the lump sum?

I tried to use the debt remedy tool with StepChange and it said to make token payments as my financial situation is expected to change in the next 12 months. When if anything, for over the next 12months, nothing will change.

So confused, please can anyone advise.

the backdated ESA would be seen as an asset by the Insolvency Service. It can be used prior to entering a DRO to replace essential items such as your washing machine, and to pay your £90 fee, but the Insolvency Service would not allow you to keep the funds for use during the period of the DRO, they would class this as cash in the bank (or in hand) and would calculate the value of it. for costs that you will have you ought to budget for them as part of your month to month expenditure.

I would also recommend dealing with a human at Step Change, their online tool is great if your circs are straightforward, but its only a computer system so not sure how it copes with different situations...

hear_me_roar

Yeah, that's what I thought. As far as I'm aware at the moment from searching through various sites, they class it as income over the period the backdate was issued. Which in my case is over 4 months. So it would be classed as 4 months worth of income.

My expenditure will exceed my income greatly purely based on transport costs. I am due to start a 12 month Schema Therapy program through the NHS referred by my Psychiatrist. As far as I'm aware these are weekly appointments and are a train ride, then a bus ride away from where I live, which for me isn't suitable due to suffering with anxiety and on/off agoraphobic symptoms. This would mean I would have to get taxis and due to being able to get public transport on occasion, I can't get help with travel costs for taxis, so I would have to fund the costs myself.

I was awarded £1060 backdated. So after a washing machine and paying for the DRO itself, it would only leave me with £720.
Assuming £250 is an acceptable price for a washing machine.
Would £250 be an acceptable amount for a washing machine?

At the moment my expenditure exceeds my income by around £20 or so not taking into account the transport costs which I have yet to add on after calculating the income added on for my backdate. So I am £70 within the limit of being accepted for a DRO. Since they allow an excess of £50 left over income and taking into account I'm £20 over expenditure.

As far as I'm aware, the Hospital where the Therapy is undertaken is around 30minutes from where I live and would cost roughly £35 for a round trip there and back. If this was weekly, it would amount to £140 a month(only roughly estimating 4 weeks in a month). So for the 4 month period would come to £560, leaving an excess of £160 split between the 4 months (£40 each month). Which would leave me £20 excess after taking into account my expenditure before adding on travel costs. Subsequently I will still have to borrow money and try get lifts through family members when the money runs out as I can only get travel costs reimbursed for public transport which as I say, isn't suitable and it's a 12 month therapy course.

Sorry for the mish mash of numbers and yes they are rough estimates, if anything I would be left with less than stated.

Would that be acceptable to apply for a DRO under these circumstances taking everything into account?

I have phone-phobia so can't use the phone and struggle to meet people face to face a lot of the time. So I am trying to sort it all out via email.

In the meantime any further advice would be much appreciated and if you need any clarification on anything I said, please just say.

wba31

hear_me_roar wrote: »

Yeah, that's what I thought. As far as I'm aware at the moment from searching through various sites, they class it as income over the period the backdate was issued. Which in my case is over 4 months. So it would be classed as 4 months worth of income.

My expenditure will exceed my income greatly purely based on transport costs. I am due to start a 12 month Schema Therapy program through the NHS referred by my Psychiatrist. As far as I'm aware these are weekly appointments and are a train ride, then a bus ride away from where I live, which for me isn't suitable due to suffering with anxiety and on/off agoraphobic symptoms. This would mean I would have to get taxis and due to being able to get public transport on occasion, I can't get help with travel costs for taxis, so I would have to fund the costs myself.

I was awarded £1060 backdated. So after a washing machine and paying for the DRO itself, it would only leave me with £720.
Assuming £250 is an acceptable price for a washing machine.
Would £250 be an acceptable amount for a washing machine?

At the moment my expenditure exceeds my income by around £20 or so not taking into account the transport costs which I have yet to add on after calculating the income added on for my backdate. So I am £70 within the limit of being accepted for a DRO. Since they allow an excess of £50 left over income and taking into account I'm £20 over expenditure.

As far as I'm aware, the Hospital where the Therapy is undertaken is around 30minutes from where I live and would cost roughly £35 for a round trip there and back. If this was weekly, it would amount to £140 a month(only roughly estimating 4 weeks in a month). So for the 4 month period would come to £560, leaving an excess of £160 split between the 4 months (£40 each month). Which would leave me £20 excess after taking into account my expenditure before adding on travel costs. Subsequently I will still have to borrow money and try get lifts through family members when the money runs out as I can only get travel costs reimbursed for public transport which as I say, isn't suitable and it's a 12 month therapy course.

Sorry for the mish mash of numbers and yes they are rough estimates, if anything I would be left with less than stated.

Would that be acceptable to apply for a DRO under these circumstances taking everything into account?

I have phone-phobia so can't use the phone and struggle to meet people face to face a lot of the time. So I am trying to sort it all out via email.

In the meantime any further advice would be much appreciated and if you need any clarification on anything I said, please just say.

The rules changed a few months back so it is no longer seen as income for the time awarded, it is now the asset instead.

In my experience of dealing with Step Change DRO people it is mainly telephone based due to the stuff they cover to check all is ok. Do you have a family member or friend or support worker who can talk on your behalf to a debt advisor?

hear_me_roar

According to the lady I chatted with at StepChange on LiveChat it is classed as future income for the duration the backdated money was awarded for... so now I'm confused because you are saying otherwise.