Should / can I DRO?

dkd1987

Hi all

I have a DMP with Stepchange in mine and hubby's name. It is roughly £400 per month over 7 y 11m.

Hubby works full time and I am a housewife, 2 young kids.

Some of the debt is in my name only - small enough to cover a DRO. However, I have a 2006 audi which Parkers recommends a value of 3500. The car is high mileage (190k), requires a new rear bumper, alloys scuffed to hell, massive crack in windscreen and turbo problems (goes into limp mode, engine light on) so to me it's worth less than £1000!

I also have a credit card not on the DMP - it's around £1400, my dad has been helping me make the minimum payments but I have missed some. This was because I stupidly thought keeping 1 good account over several years would help :huh:

Would I be able to get a DRO? Will my home address be published like it is when you're bankrupt?

I'm not sure if this is the best idea or not but it would cut the debt from 38 to 23 k which would make a huge difference, assuming all my single debt and half the joint debt is wiped.

National_Debtline

Hi dkd


Some thoughts below in bold.

dkd1987 wrote: »

Hi all

I have a DMP with Stepchange in mine and hubby's name. It is roughly £400 per month over 7 y 11m.

Hubby works full time and I am a housewife, 2 young kids.

Some of the debt is in my name only - small enough to cover a DRO. However, I have a 2006 audi which Parkers recommends a value of 3500. The car is high mileage (190k), requires a new rear bumper, alloys scuffed to hell, massive crack in windscreen and turbo problems (goes into limp mode, engine light on) so to me it's worth less than £1000! It's crucial for a DRO that the car be valued objectively. Parkers can only give an indicative value and will usually assume "average" wear and tear + mileage for a given model/reg. You could perhaps obtain a more accurate figure by consulting two or three local 2nd hand dealerships.

I also have a credit card not on the DMP - it's around £1400, my dad has been helping me make the minimum payments but I have missed some. This was because I stupidly thought keeping 1 good account over several years would help :huh:
You need to stop these payments immediately if you have designs on a DRO. Any "preferences" you have shown to creditors in the period preceding a DRO will be taken into account and can potentially result in an application being rejected. This is not to say that a DRO would be a total non-starter - it's just something that needs to be addressed as a priority.

Would I be able to get a DRO? Will my home address be published like it is when you're bankrupt?
Too many variable and unknowns (see above for example) to say whether you would be able to get a DRO at this stage. If you did set one up, your details would appear on exactly the same register used for bankruptcies and Individual Voluntary Arrangements - the record would disappear three months after the end of the 12-month "moratorium" period.

I'm not sure if this is the best idea or not but it would cut the debt from 38 to 23 k which would make a huge difference, assuming all my single debt and half the joint debt is wiped.
Just to be very clear - any debts owed in joint names would not be halved in the event of your doing a DRO. You and your partner are "jointly and severally liable" for the full balance of any joint credit debt. For example, if you owe a joint loan of £10,000 and you personally do a DRO, your partner can still be chased for the full £10K - the lender is simply barred from pursuing you.


For this and other reasons, it is worth the two of you thinking about your options collectively. More often than not, it is logical for both parties to declare themselves insolvent if the debts are evenly spread. In your partner's case, this may mean they have to choose bankruptcy if their debts are over the DRO limit.


If you are having doubts that DMP is the right route for you, why not have a chat with Stepchange about it?

Dennis
@natdebtline

fatbelly

From OP's other post

I am on a DMP with stepchange, a year in with just under 8 years to go, joint with husband.

Currently own a house worth around 125k with a mortgage of 104k.

so the answer is no. You cannot do a DRO.

National_Debtline

fatbelly wrote: »

From OP's other post



so the answer is no. You cannot do a DRO.

Thanks FB


It does make life easier when all the poster's questions are kept on one thread!


Dennis
@natdebtline