Debt Management Plan or DRO?

antsea

Hi. I have come to a crisis point with debt problems and talked to CCCS about it.

They thought my best option would be a Debt Management Plan where I pay what I can afford towards my creditors.

I am rebuilding my career after a couple of years of ill health and am currently working part-time. I was lucky to get a professional part-time job in the current climate. I have also been trying to find casual work to fit around it, but it's hard with my hours and history.

Now I do want to be responsible for my life, but it just seems like a debt relief order is a better option. I don't know if my income can change in the next year, and if not I would have a clean slate. As things stand I would be paying off my creditors for the next 15 years on minimal living expenses, and that doesn't take into account unforseen problems.

If I thought I was going to get a good job, then sure I'd pay it off but I don't know when that could happen.

Before I speak to CCCS again I wanted to see what you think, and see if there's anything I haven't thought of with the two routes.

Thanks a lot for your help.

dojoman

Try talking to CAB or National Debt Line, the CCS are sometimes biased and don`t always give out the best advice.



https://www.nationaldebtline.co.uk/
https://www.citizensadvice.org.uk/

Penelope_Penguin

antsea wrote: »

Before I speak to CCCS again I wanted to see what you think, and see if there's anything I haven't thought of with the two routes.

Thanks a lot for your help.

A few questions:

Have you any assets - including car, pension policy, life policy. If so, how much is each worth?

Is your income likely to rise ove the next 12 months?

Have you drawn up a SOA? If so, would you like to share it What available income do you have each month?

What is the total level of all your debts?

They are the questions I'd ask a client coming to see me; we'll then be able to assess your options.

antsea

Hi there. Thanks for the responses.

In answer to your questions Penelope Penguin,

I don't have any assets.

I don't think my income will rise significantly, but I might get a couple of extra hours which could cause problems with thresholds now I come to think of it.

I've just used the debt analyzer tool to do a SOA.


Monthly income £862.00
Monthly outgoings £651.53
Total priority debt arrears £503.09
Monthly priority debt arrears payments 1 £56.33
Total unsecured debts £6,010.83
Contracted unsecured payments £274.00
Initial amount available to pay creditors pcm 2 £154.14
Years it will take to repay your debts 3 2.5 (30 months)

Thanks a lot for your attention to this.

Penelope_Penguin

antsea wrote: »

Monthly income £862.00
Monthly outgoings £651.53

From this, your income is about £200pcm greater than your outgoings, which will preclude you from a DRO, sorry.

Try putting your SOA into the MSE template - hang on and I'll find a link ............ Try this.

dojoman

Do as PP suggests and post your SOA on here, here is the link you need.

http://www.makesenseofcards.com/soacalc.html

antsea

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 0

Monthly Income Details
Monthly income after tax................ 951.46
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 951.46

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 245.52
Management charge (leasehold property).. 0
Council tax............................. 101
Electricity............................. 20
Gas..................................... 12
Oil..................................... 0
Water rates............................. 7
Telephone (land line)................... 9.79
Mobile phone............................ 7
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 14
Groceries etc. ......................... 180
Clothing................................ 22
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 74.96
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 26.31
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 17
Holiday................................. 0
Emergency fund.......................... 0
Sundries and Emergencies................ 12
Total monthly expenses.................. 748.58


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
A&L Overdraft..................920.......46........22.2
Barclays Overdraft.............3016......165.......19.35
Barclaycard....................1714.83...38.58.....27.9
Capital One CC.................151.67....5.........30.34

antsea

Hi. This is the SOA. I used some calculations for monthly repayment of overdraft from the CCCS. I don't know if that's right. Does it make sense to you, as my head is broken now! Thanks.

Penelope_Penguin

Well done! It makes sense to me

Based on those figures - you have too much monthly income for a DRO. There may be some tweaking on exact figures, but I don;t belive there'll be enough to bring you within the allowed limit.

You could do a DMP, but as you say, that will take a while to pay off.

Have you considered bankruptcy? This will cost you £625 (from April) and there will be many other things to consider if you go down this route, but you will be freed from your debts.

Good luck for whatever you choose :T

antsea

Thanks for the reply.

Is it possible to get in before April and pay the current fee? I think it's £150?

From searching it looks like you're made bankrupt from the day you file the papers.

Penelope_Penguin

antsea wrote: »

Thanks for the reply.

Is it possible to get in before April and pay the current fee? I think it's £150?

From searching it looks like you're made bankrupt from the day you file the papers.

I booked a BR appointment yesterday and it was for May :eek: Give your court a ring and see what they say. You may get lucky and get a cancellation. The total cost just now is £600.

Yes, you are made BR on the day you file. From that time you have no further liability.