Debt Relief Orders (DRO) - Information & help thread

tonibennett

Hello. The CAB yesterday advised me to go for a dro, but the situation is slightly complicated because in desperation to manage my debt, I had transferred £1,500 to my dad's credit card and the same to my sisters (both 0% balnces) but I still can't afford the minimum repayments. Also my mil lent us £1500 of her own money so essentially while I am still in 8k debt (6k on credit cards and 2koverdraft) only now the overdraft and 2k of the credit cardisin myname. The CAB lady advised me that I need to get as much of the debt back into my name as possible so that they can then go about getting to DRO. But I am worried now that I have read the official receiver can turn it down, because if I trnsfer it back onto a card with interest, while it is currently interest free, i am going tobe in a worse situation. Also, will it look dodgy to the official receiver, will they question why I have suddenly put these balances onto my card and where they came from?

My last query is that I still only have my credit card to live on while this is all going on. So I have no option but to further spend on a card which in theory I know could be wiped and I'm worried this willlook dishonest! Do they pull apart your credit card statement like, why have you bought this and why is there an amazon purchase on there? In reality it is things like I bought our mum's birthday present on my card so that everyone else could give me the cash, but I don't want everything I have done pulled apart. I only have 1 towel left in the house and I need to buy a new one and I am afraid to put this on my card now in case it is questioned why am I spending credit on luxury items like towels. I'd really appreciate your help as I cannot get through to the lady I spoke to and I am very anxious.

Thank you so much

HappyDays1980

Hi All

On the advice of Stepchange I have applied for a DRO. All of the items they requested were received at their office this morning. Can anyone who has been through this give me an idea of how long it will take before they reply and ask me to pay the £90 fee.

Thanks

fatbelly

tonibennett wrote: »

Hello. The CAB yesterday advised me to go for a dro, but the situation is slightly complicated because in desperation to manage my debt, I had transferred £1,500 to my dad's credit card and the same to my sisters (both 0% balnces) but I still can't afford the minimum repayments. Also my mil lent us £1500 of her own money so essentially while I am still in 8k debt (6k on credit cards and 2koverdraft) only now the overdraft and 2k of the credit cardisin myname. The CAB lady advised me that I need to get as much of the debt back into my name as possible so that they can then go about getting to DRO. But I am worried now that I have read the official receiver can turn it down, because if I trnsfer it back onto a card with interest, while it is currently interest free, i am going tobe in a worse situation. Also, will it look dodgy to the official receiver, will they question why I have suddenly put these balances onto my card and where they came from?

My last query is that I still only have my credit card to live on while this is all going on. So I have no option but to further spend on a card which in theory I know could be wiped and I'm worried this willlook dishonest! Do they pull apart your credit card statement like, why have you bought this and why is there an amazon purchase on there? In reality it is things like I bought our mum's birthday present on my card so that everyone else could give me the cash, but I don't want everything I have done pulled apart. I only have 1 towel left in the house and I need to buy a new one and I am afraid to put this on my card now in case it is questioned why am I spending credit on luxury items like towels. I'd really appreciate your help as I cannot get through to the lady I spoke to and I am very anxious.

Thank you so much

Really your situation needs to be stable when you apply for a DRO and it isn't if you are 'living on credit'

Why are you not on benefits?

We can't predict what the DRO Unit will do but all I would say is be guided by your intermediary and don't do the application until your situation is stable (the limit is 20k so there's no panic)

fatbelly

HappyDays1980 wrote: »

Hi All

On the advice of Stepchange I have applied for a DRO. All of the items they requested were received at their office this morning. Can anyone who has been through this give me an idea of how long it will take before they reply and ask me to pay the £90 fee.

Thanks

If there's no good reason for a delay ask them to issue your barcode letter tomorrow.

tonibennett

Hi

We are on child tax credit and we are in the process of getting housing benefit sorted but it's taking a while, when it does we should be getting £109 a week, they tell me. We have a baby under a year which is why I am not working.
When you say stable, what do you mean exactly...do you mean that I have money other than credit to live on? In which case, should I keep using my credit card (well, i have no choice, there's no other money) until the benefits are sorted? Because with all my repayments, all the benefits are going to go on repayments, instead of day to day expenses.
Hope that makes sense, thanks for your help

fatbelly

tonibennett wrote: »

Hi

We are on child tax credit and we are in the process of getting housing benefit sorted but it's taking a while, when it does we should be getting £109 a week, they tell me. We have a baby under a year which is why I am not working.
When you say stable, what do you mean exactly...do you mean that I have money other than credit to live on? In which case, should I keep using my credit card (well, i have no choice, there's no other money) until the benefits are sorted? Because with all my repayments, all the benefits are going to go on repayments, instead of day to day expenses.
Hope that makes sense, thanks for your help

Private and housing association tenants should get a stop-gap housing benefit payment if their claim takes more than two weeks to process. This is called payment on account.

http://england.shelter.org.uk/get_advice/housing_benefit_and_local_housing_allowance/applying_for_housing_benefit/getting_payment_on_account2

Don't be afraid to chase your council.

So you will be getting HB, Council Tax Support, CB, CTC and (I assume) joint JSA. Or does your OH work?

When you stop making repayments on your debts (and you should do that well ahead of your DRO application) you will need to budget so that you can live on your income because you will not be able to get further credit.

That's part of what I mean by stable.

The other part is that you need to have a reasonable expectation of staying within the DRO criteria for the next 12 months. If you are expecting to get a job that pays well and takes you to over £50 per month surplus, then there's little point starting a DRO at that time.

tonibennett

Thnk you Fatbelly. One last queston, does the official receiver look at all your expenditure from your credit cardsand debt, I ask because I read they can turn you down if they can consider the debt to be careless. I would presume maybe that means you lied to get a card you had no intention of paying back, but a bit worried it means they look at your bills and say, "Well, did you really need to buy a ticket for a concert last Christmas, or this, or that? This was a careless purchase.

I so wish I hadn't transferred my santander debt of £1600 onto my sister's 0% card but I was paying 21% interest for so long and thought it was my only option to at least reduce repayments. But now if I had left it, I could just stop paying it but that would never have occured to me! Is it as simple as simply transferring it back? The CAB lady said to do so but at the same time she admitted she wasn't totally sure how it worked, which makes me nervous.

National_Debtline

tonibennett wrote: »

Thnk you Fatbelly. One last queston, does the official receiver look at all your expenditure from your credit cardsand debt, I ask because I read they can turn you down if they can consider the debt to be careless. I would presume maybe that means you lied to get a card you had no intention of paying back, but a bit worried it means they look at your bills and say, "Well, did you really need to buy a ticket for a concert last Christmas, or this, or that? This was a careless purchase.

I so wish I hadn't transferred my santander debt of £1600 onto my sister's 0% card but I was paying 21% interest for so long and thought it was my only option to at least reduce repayments. But now if I had left it, I could just stop paying it but that would never have occured to me! Is it as simple as simply transferring it back? The CAB lady said to do so but at the same time she admitted she wasn't totally sure how it worked, which makes me nervous.

Hi toni


With a DRO, it's really the job of the intermediary to identify anything that might be problematic before submitting your application. They will submit it if they're satisfied that everything looks ok - if there are any potential snags, they can still put it through but they will warn you that you could lose your £90 fee if it is later rejected or revoked.


The Insolvency Service will sometimes do spot checks on submitted applications, but not every DRO is looked at by them in the same way that bankruptcies would be.


Re: the £1600 balance now on your sister's card, I fear that you will not be able to incorporate this into your DRO. Attempting to transfer it back now would almost certainly be seen as a "preference" - that's if your card issuer even authorises such a transaction. As far as the DRO is concerned, you must now either class your sister as just another creditor, or class the balance transfer as a "gift" from her to you.


Dennis
@natdebtline

tonibennett

Thank you for your reply. Could you pls explain what you mean by preference? I also have a £1200 balance on my dad's card, whch is up and I am gong to have to try and transfer it back anyway, regardless of any DRO, would this be seen in the same light? I have moved balances before then just transferred another balance on a couple of months later`, t`hat's how I've been living to try and beat interest for several years! Only £4000 of my debt is n my name and if that's all I can add into the DRO, I'm not sure it's worth it! Although saying that, I can't afford any of the repayments :-(

fatbelly

tonibennett wrote: »

Thank you for your reply. Could you pls explain what you mean by preference? I also have a £1200 balance on my dad's card, whch is up and I am gong to have to try and transfer it back anyway, regardless of any DRO, would this be seen in the same light? I have moved balances before then just transferred another balance on a couple of months later`, t`hat's how I've been living to try and beat interest for several years! Only £4000 of my debt is n my name and if that's all I can add into the DRO, I'm not sure it's worth it! Although saying that, I can't afford any of the repayments :-(

A preference is treating one creditor more favourably than another.

In the DRO application you are asked

Have you preferred any creditors over others in your payments in the last 2 years?

In the drop down box it says

An example of a preferential payment being when a debtor pays a creditor in full, in the last 2 years without paying his other creditors anything at all, thus placing one creditor in a far better position than the others.

You should be aware that any items in this section will be referred to the Official Receiver for consideration and the application may be rejected.

it could come under the remit of a DRRO/DRRU:

The Insolvency Service also has the power to issue a debt relief restriction order or receive a debt relief restriction undertaking (DRRO/DRRU) should the Official Receiver consider the behaviour of someone subject to a DRO to have been reckless or dishonest in contributing to the DRO.

As I said before, be guided by your intermediary.