Avoiding a DRO

lepidopterist

Hi there;

I'm currently pretty heavily in debt, and unemployed. I could definitely do a DRO, but I'd rather not if it can be at avoided.

My debts are mostly with utility companies, some have been sold on to collection agencies, and there's also a couple of grand spread around three credit cards, and a £4k overdraft.

MY QUESTION - how likely is it that I will be able to negotiate a nominal repayment plan with a) collection agencies, and b) credit card firms? I assume that if I tell them that I'm going to have to take out a DRO unles sthey cut me some slack, they'll be happy to set up a nominal repayment scheme.

Have I assumed wrong?

Thanks in advance for all help!

debt_doctor

Hi,

If any of the utilities are your current supplier then you would have to set up an arrangement of ongoing costs plus £3.55pw towards the arrears. The arrears could be paid by card, pre pay meter or fuel direct (a scheme set up to take ongoing and arrears out of benefits.)

The rest are non priority so could potentially be offered £1 pm in payment. You could write to your creditors enclosing a financial statement, stating your current circs. A debt charity might assist you with this.

Advantages - a short to mediumish way to keep creditors at bay if your situation in temporary.

Disadvantages - interest and charges do not always stop, so the debt could increase. It does not guarantee they wont take court action (although there is little to gain from that in your current circs, so unlikely). Creditors may continue to contact you on a very frequent basis.

Most creditors don't take too much notice of threats of insolvency, although I agree with your logic.

DD

alastairq

Also, open new [basic] account with another bank entirely, for income, such as it is?

{Co-op or Barclays?}