dro question

swim1

Hi all,
One of the conditions of getting a DRO is that you can't have assets over £300
Im considering a DRO due to my situation.
One of my 'debts' is with a credit union.
I owe around £9000 .
Im not in arrears with them because they take the weekly payment direct from my wages.
But I can't afford it together with everything else.
Anyway,one of the credit unions conditions when you get a loan off them,is you have to have at least a third of the loan in 'savings' with them (as security).
Ive around £3000 in savings with them,which I can't access because of the reason Ive just given.
Im concerned I'll be turned down for a DRO because of this.
I can't touch the savings and if I got a DRO the credit union would just keep them/write off against rest of debt.
But concerned that technically I don't meet criteria.
Sorry for being longwinded.
Any advice appreciated.

debt_doctor

Hi,

You are right to be concerned as you do not qualify for a DRO and would lose your fee.
You would be required to declare the savings as an asset.

DD

swim1

If thats the case what are my options?
I need the credit union to stop my payment (it comes direct from my wages)
/write off the loan.
I can't afford the weekly payment together with everything else.
If they don't I'll be in serious trouble v.soon
Its not a case of them reducing the payment,I need it stopped in full.
Hence the DRO (or not.)

debt_doctor

First, you should seek some advice from a debt charity.
You could draw up a financial statement and this would show how much you could afford to pay, anywhere from a £1 per month upwards.
I agree that the credit union would take the £3000 savings to offset their debt once you defaulted.
You should cancel the direct debit or debit card payment with the credit union and the bank.
Also if you bank with any of your creditors, get a new account.

DD

swim1

debt_doctor wrote: »

First, you should seek some advice from a debt charity.
You could draw up a financial statement and this would show how much you could afford to pay, anywhere from a £1 per month upwards.
You should cancel the direct debit or debit card payment with the credit union.
DD

I've already done financial statement with national debtline.
No money left to pay creditors. Advised to pay token £1 in mean time.
I can't cancel payment to credit union.
I contacted my payroll dept and they said the only people who can cancel/alter payment are credit union. (presumably due to agreement I signed)
Thats why Im so concerned...feel like Im at mercy of credit union.

swim1

the credit union payment comes directly from my wages/at source.

debt_doctor

I have never seen that method of payment, but I know they do exist.
You should read the document you signed for any cancelation rights.
Also contact the credit union and ask them to stop payments due to hardship.
Trouble with credit unions is that many (it depends how they trade) are exempt from most of the regulations that protect us.

DD

swim1

Theres nothing in loan agreement regarding cancellation.
What happens if I contact them and ask them to stop payment/write off due to hardship and they wont?
Whats my next step?
This is really getting me down.

debt_doctor

it would depend if they have a consumer credit licence or not. Some credit unions need one, some dont. If they do then if they wont treat you with forbearance then you could make a complaint and get it to the ombudsman.
But first, ask them to reduce payments in line with national debtlines recomendations.

DD

swim1

on there website it says 'regulated by FSA' etc.

Dano1311

I had a creditor on my DRO was Voyager Credit Union, i was 'Naughty' and rang them up and told them i was quitting my job and starting another and needed to change payment to Direct Debit. they said thats not a problem, and then stopped the direct deduction from my wages started the direct debit which i then cancelled, i know technically this isnt an ideal way around it, but i did it this way maybe you could try the same??