Payday loan dishonour fee & DRO

davnig

My daughter having got into financial difficulties has decided after much thought to apply for a DRO as she cannot manage the payments necessary for an IVA on her meager benefits income.

One of the debts is with PoundsToPocket and she informed them last week that she was applying for a DRO and they said that they would hold off with any demands for 28 days. Then this morning she received a letter demanding a £40 dishonour fee. Now am I correct in thinking that due to the impending DRO this cannot be pursued and it may just be that the letter was sent out before she informed them?

thanks

DorisTrousers

If the debt is covered by the IVA, and the IVA is still live/open, then the charge is worthless as interest and charges must be frozen once an IVA is accepted.

If the debt occurred after IVA then she may be in breach, depending on how much is owed, but as she is now looking at DRO instead then that is splitting hairs as well (unless the balance takes her over £15k).

Be aware that if the IVA is still open, most I.P's will keep it that way until PPI has been investigated. If that is the case, best to co-operate with that process to get to the end quicker.

fatbelly

No problems. She just adds £40 to the balance figure when she submits her application for a DRO

If I understand your first post correctly, she has neither an IVA or a DRO as things stand.

As a general point she should not be informing creditors what she intends to do. Inform them when she has done it.

alastairq

As a general point she should not be informing creditors what she intends to do. Inform them when she has done it.

Absolutely agree with that one.

longtermplanner

davnig wrote: »

Now am I correct in thinking that due to the impending DRO this cannot be pursued and it may just be that the letter was sent out before she informed them?

No, they are entitled on trying to collect what is owed. She just needs to get on with the DRO asap and this extra rip off fee will be included in her debt to them.