Debt Relief Orders (DRO) - Information & help thread

smallandcute

Hi Fatbelly,



Yes looked at a DRO a little while ago. Circumstances changed so started paying off debts but they have since changed again so i am back to square one. I will post properly in the next few days a complete statement of affairs and my situation for best advise. Thanks so much for all your help.

Mummazeb

Hi I'm very new here so apologies if this has already been asked.
We're looking at doing a dro. We are solely on benefits at the moment and can't see this changing for a while as hubby has health problems which will result in surgery. Anyway step change have just told me that the creditors can reject the dro application. this worries me. I've got two creditors who are just plain horrible and I gave visions of them rejecting it and then I've lost the money. has anyone had this happen at all?

Thanks

fatbelly

Mummazeb wrote: »

Hi I'm very new here so apologies if this has already been asked.
We're looking at doing a dro. We are solely on benefits at the moment and can't see this changing for a while as hubby has health problems which will result in surgery. Anyway step change have just told me that the creditors can reject the dro application. this worries me. I've got two creditors who are just plain horrible and I gave visions of them rejecting it and then I've lost the money. has anyone had this happen at all?

Thanks

I think I need to pop over to stepchange and give them a lecture.

Yes, creditors can object but they hardly ever do, and should never be successful if the intermediary submitting the application has done his/her job properly.

The only time I've had a nearly successful creditor objection was when we were right up to the 20k limit and the water authority found an old debt from their archive. I pointed out that we had already asked them if the client had any other debts to them and they had replied in the negative. They agreed to drop the matter.

Provide you meet the basics:

•Must not be a homeowner,

• Debts less than £20,000,

• Can have a car worth up to £1000,

• No other assets of more than £1000,

• Must have £50 or less left at month end, after all essential payments have been made (not inc debt repayments),

• Cannot have had a DRO in last 6 years.

You'll be fine.

However, you must understand that DROs are an individual solution - your debts will be frozen, then written off. If any are joint debts they move over to the other party, and if he has any debts, pre or post DRO he will have to make his own arrangements which may be another DRO.

Mummazeb

Thank you so much for putting my mind at rest. Yes we will both be doing the application so that we're both covered as there are debts in both our names.
Just so stressful. Thanks again. :T

DourPower

Hi All - my wife and I are in difficult financial situations, but keep our finances separate - she's been on the phone to BDL and they're recommending DROs for both of us - she's going to go first.

I have many questions but the burning one is she's been told that activity on the cards in the weeks before the DRO can jeopardise the application..

My intention is/was that prior to any debt management *thing* to use remaining credit that I have on existing cards to clear my overdraft and cards at Lloyds, where my account and my young daughter's linked account are. I want that to become my debt-free account. I've also (before all this kicked off) booked in to have my (£600 value) car serviced and tyres done, using a new 0% purchases card I've just taken out last week. Are both of these spectacularly bad ideas? edit: I should say such car maintenance is in our household budget at this point.

All my cards are 0% at the moment, and my credit rating seems to have been good enough to get another card last week, but obviously our household balance is negative anyway, even before we try and make these payments...moving the payments from one card or overdraft to another doesn't make much difference.

I feel kind of pressured by her DRO, and its emphasis on household income, as if me scrimping to make card payments is somehow selfish... I don't understand how a DRO is personal yet it seems to be all about household income... if we both have DRO's is it one £50 rule or is it £50 each?

I know on DMP threads it's all about accumulating an 'emergency fund' before hitting go - I guess that is the opposite for DRO where you'd not want to build an asset that would lead to it being revoked (even if you could, which is doubtful). Given that we have six years ahead with no credit do we just get through the year as best we can and then start trying to protect ourselves with a fund?

sourcrates

DourPower wrote: »

Hi All - my wife and I are in difficult financial situations, but keep our finances separate - she's been on the phone to BDL and they're recommending DROs for both of us - she's going to go first.

I have many questions but the burning one is she's been told that activity on the cards in the weeks before the DRO can jeopardise the application..

My intention is/was that prior to any debt management *thing* to use remaining credit that I have on existing cards to clear my overdraft and cards at Lloyds, where my account and my young daughter's linked account are. I want that to become my debt-free account. I've also (before all this kicked off) booked in to have my (£600 value) car serviced and tyres done, using a new 0% purchases card I've just taken out last week. Are both of these spectacularly bad ideas? edit: I should say such car maintenance is in our household budget at this point.

All my cards are 0% at the moment, and my credit rating seems to have been good enough to get another card last week, but obviously our household balance is negative anyway, even before we try and make these payments...moving the payments from one card or overdraft to another doesn't make much difference.

I feel kind of pressured by her DRO, and its emphasis on household income, as if me scrimping to make card payments is somehow selfish... I don't understand how a DRO is personal yet it seems to be all about household income... if we both have DRO's is it one £50 rule or is it £50 each?

I know on DMP threads it's all about accumulating an 'emergency fund' before hitting go - I guess that is the opposite for DRO where you'd not want to build an asset that would lead to it being revoked (even if you could, which is doubtful). Given that we have six years ahead with no credit do we just get through the year as best we can and then start trying to protect ourselves with a fund?

Spectacularly bad idea yes, it will be seen as favouring certain creditors and could lead to a DRO been declined.

You need to open a new basic bank account with a bank you have no debt with.

DRO's are individual arrangements, so the £50 threshold applies to each of you.

DourPower

Thanks Sourcrates, ho hum, will have to do the same for my daughter's account too I suppose. And move all the household bills...

What about the car repairs? I mean, that's normal use, right? Is that still a No-No?

so the DRO's are individual arrangements and the £50 threshold applies individually to both of us, so does that make it a £100 threshold on the household?

I'm so confused, I hope any answers might help others too....

fatbelly

DourPower wrote: »

Hi All - my wife and I are in difficult financial situations, but keep our finances separate - she's been on the phone to BDL and they're recommending DROs for both of us - she's going to go first.

I have many questions but the burning one is she's been told that activity on the cards in the weeks before the DRO can jeopardise the application..

My intention is/was that prior to any debt management *thing* to use remaining credit that I have on existing cards to clear my overdraft and cards at Lloyds, where my account and my young daughter's linked account are. I want that to become my debt-free account. I've also (before all this kicked off) booked in to have my (£600 value) car serviced and tyres done, using a new 0% purchases card I've just taken out last week. Are both of these spectacularly bad ideas? edit: I should say such car maintenance is in our household budget at this point.

All my cards are 0% at the moment, and my credit rating seems to have been good enough to get another card last week, but obviously our household balance is negative anyway, even before we try and make these payments...moving the payments from one card or overdraft to another doesn't make much difference.

I feel kind of pressured by her DRO, and its emphasis on household income, as if me scrimping to make card payments is somehow selfish... I don't understand how a DRO is personal yet it seems to be all about household income... if we both have DRO's is it one £50 rule or is it £50 each?

I know on DMP threads it's all about accumulating an 'emergency fund' before hitting go - I guess that is the opposite for DRO where you'd not want to build an asset that would lead to it being revoked (even if you could, which is doubtful). Given that we have six years ahead with no credit do we just get through the year as best we can and then start trying to protect ourselves with a fund?

If your wife's recent spending on credit is OK there's no reason for her not to go first with her DRO - in fact that's what I'd recommend.

If you need to do some final spending then do it - a few months delay won't make much difference in the grand scheme of things. It's technically wrong to do this when you already know you're insolvent but honestly I've seen all sorts of behaviour from my clients (I'm an intermediary with CAB) and not had any problems yet.

Any joint debts will move over to you for a bit.

On the surplus income thing, we look at the household income and then divide the expenses pro-rata to your incomes. So if you earn twice as much as your partner then you take twice the expenses. Mathematically that could mean the household could have £100 surplus only if the incomes were the same.

As long as you are declaring no other assets apart from the car you can each have up to £1000 on entering a DRO.

DourPower

Thanks so much Mr FB - it turns out I don't think I'll be able to DRO because I have an asset - (a ruined Shed in Croatia that I paid peanuts for twelve years ago and often fully forget about in day-to-day life but definitely worth more than 1K)... sigh.

So I'll have to go back to considering IVA/DMP directions instead.

Will my asset likely affect my wife's chances of a DRO?

fatbelly

DourPower wrote: »

Thanks so much Mr FB - it turns out I don't think I'll be able to DRO because I have an asset - (a ruined Shed in Croatia that I paid peanuts for twelve years ago and often fully forget about in day-to-day life but definitely worth more than 1K)... sigh.

So I'll have to go back to considering IVA/DMP directions instead.

Will my asset likely affect my wife's chances of a DRO?

Can you not sell the Croatia shed?

If your wife does not own the shed, it does not affect her DRO

Did BDL know about this when they recommended DRO x 2?