Can I recieve owed money whilst on a dro?

Mumof4kids

I am 3 months into a dro, I have received a letter from a mortgage company I used 6 years ago stating that a payment went through that didn't get registered and they going to send me a chq with 6 years interest, I have no idea how much, this company is not part of my dro but I need to know how much am I allowed to recieve whilst under a dro and can this now affect me? Any other time I would be wishing for a large sum but now I'm hoping its minimal.

National_Debtline

Hello there. If the refund is more than £300 you would need to notify the Insolvency Service. There is the possibility that your DRO could be revoked.

I can appreciate that quandary that this may cause you. If the refund is of a reasonable amount - and if the DRO is revoked (revocation is a discretionary action) - you may be able to consider making full & final settlement offers to your creditors instead:

http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=24_full_and_final_settlement_offers

Best wishes,

David @ NDL.

Mumof4kids

I am owed £1000 plus interest, my dro is for debts £13000, so I could loses right to a dro? Even though it's from an overpayment 6 yrs ago?

National_Debtline

The potential is there, sadly. You would have an obligation to inform the Insolvency Service. They would then choose whether or not to revoke the DRO. It would be down to their discretion. Sadly I'm unable to tell you what the potential outcome will be. I'm really sorry.

David.

DevCoder

Could you not offer to put the monies towards the creditors in the DRO?

Tiddlywinks

There's irony in the title of this thread, surely.

You are about to receive money you are owed but don't want to pay money you owe - why?

Mumof4kids

There is no irony!! I don't mind if they take it, my worry is having the whole dro revoked, if you read the thread properly you would see this is my concern.

wba31

The DRO would most likely be revoked, the grey area comes if between £300 - £700 is received and it wouldnt give you enough to go bankrupt, I've seen cases where in those circumstances the Insolvency Service would allow a DRO to continue.
As the NDL rep said, you have a duty to inform the Insolvency Service, failure to do so could be seen as fraudulent and can result in criminal prosecution, so be sure to be honest with them - but until you know exactly what you will receive there's no point contacting them now.
The money is not taken by the DRO Unit and distributed as they do not work as official receivers like in bankruptcy. If your assets are over the allowed amounts, the DRO doesnt happen.

All that being said, if you get more than £700 and the DRO is revoked, why simply use the money to delcare bankruptcy. Same overall outcome, bankruptcy cannot be revoked for circumstance changes. If you speak to the advisors that put your DRO together they can advise on this

fatbelly

You are asking a sensible question. You have 13k of debt in a DRO and face an unexpected windfall of £1000. Will that wipe out your DRO?

Of course that's a concern, as your creditors will not accept 8p in the pound in settlement. So you potentially face going for full bankruptcy with a fee of £700. Who benefits from all that? No-one.

The official guidance is as follows:

In circumstances where the debtor receives an asset, for example, backdated benefit, PPI refund, a windfall or any other property valued at more than £300 during the moratorium period, the Official Receiver is automatically exercising her discretion not to revoke for all cases so long as the debtor is open and honest and the value of the asset in question is less than £700.

For all lump sums received between £700 and £1750, each case is assessed on its own merits taking into consideration numerous factors, including but not limited to liabilities, health, personal circumstances, age, etc. and a decision will be made on an individual basis as to whether it would be appropriate to revoke or not.

For lump sum payments in excess of £1750, it is more likely that a DRO may be revoked, although any mitigating factors would be included in our determination.

I've highlighted some words & also suggest that you contact the DRO Unit tomorrow and start a dialogue on this. The fact that you are being up front, and the scale of your debts in the DRO are both factors in your favour but it could swing either way..