Help regarding DRO

Deva2005

I am sorry if this is not in the right place, but I am so worried and not sure what I am doing at the moment.

Current situation;
EDF Debt 7,000 pounds
Water debt 3,000 pounds

both of the above are in my name only

water debt 2,000 pounds
council tax debt 5,500 pounds

both above in joint names

current living arrangement, house is shared-ownership in my wife's name ONLY.

So my question is regarding trying for a DRO and how this would work for the joint debts.

I have read that I can try for the two debts in my name as I do NOT own property and we are in very low income.

Does anyone have any ideas about the joint debts, would a percentage being taken into account.

Debt issues causing me serious health issues and effecting my marriage.

If anyone can help, please let me know

Thank you all
David

fatbelly

Sudden flurry of DRO posts!

This is quite straightforward and it would appear that you qualify, as long as your surplus income is less than £50 per month and you don't own a car worth over £1000.

The principle of joint and several liability means that you each owe the full amount in joint debts. That can be a bit hard to get your head around.

So your full £17500 of debt must go in, and it's fortunate the limit recently went up to £20000! The council tax debt will still be owed in full by your partner.

Now, strictly speaking, the same should apply with the joint water debt. But I have seen water companies just deduct the amount in the DRO from the bill and start a fresh account. So it would be a case of listing the debt and seeing what happens. If the 2k balance remains outstanding, ask your local CAB or the water company themselves if they have any schemes to reduce the debt if you pay for the ongoing use.

Deva2005

Thanks for the information, but how can the council expect to get the debt from TWO parties, in effect we are paying twice when the council tax is for only one property?

Surely this is a farce?

Thanks
David

fatbelly

david.richards27 wrote: »

Thanks for the information, but how can the council expect to get the debt from TWO parties, in effect we are paying twice when the council tax is for only one property?

Surely this is a farce?

Thanks
David

OK, the liability for the debt exists in full for each party. I told you this was difficult to get your head around.

They can't actually take a total exceeding the full balance.

Suppose you owed £1000 jointly, then you separated. The council got attachment to earnings at £10 per month from you, £190 from your ex because she earns more. They would then run the attachments for 5 months until the whole debt was paid. You would have paid £50, she £950.

If you were bankrupt or had a DRO then your liability goes to zero, you pay nothing, and they have had to take a sixth payment from her (of £50) to recoup the entire amount

Deva2005

I am still 'lost' with this one.
So, if we are still together (which we are) and I apply for the whole amount as part of my DRO, they can't expect to collect from my wife as well?
My DRO will be for the whole amount of the debt...

...sorry if I a, being simple here!

fatbelly

I'm going to quote from the guidance in the hope that their wording is better than mine...

The making of a Debt Relief Order will not protect or write off the liability of any joint debt holder, or anyone who has guaranteed the debts of an individual who is the subject of a DRO.

DorisTrousers

You don't owe half each, you owe the full amount each. In the normal course of things, the bill would be paid and it is irrelevant who pays it.

Put another way, if you were run over by a bus, they wouldn't chase the remaining party for only half of the bill. So, you are back to a point where, although you cannot be chased for it, the bill must still be paid, and the fact that it will be your Mrs who is paying it is still irrelevant.

alltaken

You have a bill from ABC ltd for £1000 in both your names.

You only ever owe the £1000 but both of you are responsible for the amount being paid, ABC ltd don't care who pays it but they can if needed go after one of you if they choose.

You become insolvent, DRO whatever it is and as a result you can't be chased by ABC ltd anymore, however, your partner can because their name is on the agreement.

Your partner is then liable for the entire balance remaining.

wba31

david.richards27 wrote: »

current living arrangement, house is shared-ownership in my wife's name ONLY.

Aside from all the good advice above, i have noticed this.

If there is equity in the owned part of the property, I have seen the Insolvency Service decline a DRO on the basis of matrimonial beneficial interest (they say because you are married to the homeowner you are entitled to a share of the equity, therefore the owned part of the property is an asset).
If this is in negative equity you could proceed with the DRO but if the house equity position became positive during the moratorium it could then be an issue