Dro / iva?

fatbelly

At first glance you have too much surplus for a DRO with £230 surplus, as a couple. It looks to me that your income is 34% of the household income and 34% of £230 is still >£50. It's clear that some of those debts will not be cleared by you doing a DRO

We can also see that a joint dmp is going to take over 6 years to clear. An IVA will take 5 years so the question is whether an IP could present a case for a monthly payment less than £230.

You do need to sort something out pretty soon though as you have 2 priority debts and a ccj in there.

wba31

My thoughts on your SOA - nothing for entertainment costs? you dont have contents insurance? Do you not use a mobile phone at all? dentist/opticians?
I appreciate you might have been cutting back to try and make payments but moving forward your budget needs to reflect the key things you may not think about or have cut out in the past. I'm still unsure if putting stuff in for those things will bring your share of the surplus under £50, but it's a step in the right direction...

whose names are the debts in? are they split?

hunnybeanz

wba31 wrote: »

My thoughts on your SOA - nothing for entertainment costs? you dont have contents insurance? Do you not use a mobile phone at all? dentist/opticians?
I appreciate you might have been cutting back to try and make payments but moving forward your budget needs to reflect the key things you may not think about or have cut out in the past. I'm still unsure if putting stuff in for those things will bring your share of the surplus under £50, but it's a step in the right direction...

whose names are the debts in? are they split?

I've been usure how much to allocate to entertainment etc. We've been unable to spend at all in any of those areas, as the surplus has been used for OH's gambling issues over the last 2 years, and only now I'm getting a hold of the finances.
We DO have mobile phones, but they're PAYG, and only topped up once or twice a year.
We dont have ANY insurance at all :eek: and with two small children, we ought to have!
SC also advised for me to budget for things that we may not have actually BEEN spending on, but should be. But because we've not been spending in those areas, I dont know what kind of figure I should be allowing for.
80% of the debts are in my name, and of those only about 60% are listed on my credit report.
If I were to base my SOA solely on MY income, how does that factor towards monthly expenditure etc? I would be massively in the red at the end of every month hah hah! And then my debts on top of that!

mwarby

If based on your income alone, you'd likely to be asked for partners income, so they can check that your each paying a fair share of monthly expenses.

For entertainment some IPs(or OR or trustee or DMP co)\creditors would see your £40 tv subscription as contributing towards this. You can put down what you think is reasonable, your IP\creditors may cut this amount back if deemed excessive

Regarding an IVA its worth bearing in mind the repayments aren't fixed, and can go up and down as your circumstances change. This may mean that once combined with fees, an IVA could work out more expensive than a DMP. Of course for other an IVA would result in paying back far less than a DMP, as the term is fixed. There are many people whos circumstances have improved and feel aggrieved because they paid more than tjey expected to

mwarby

Are you really paying £40 for phone and £40 for internet ? £80 for these two combined sounds excessive. Given you can get phone and broadband for £20 a month if you shop around. If these are genuine and are accepted I'd certainly shop around when time allows

Also for gas and electricity, are these £120 each, or for both combined

hunnybeanz

Hi mwarby
Thanks for replying. The gas and electric is 120 pcm EACH at the moment, as heating system and boiler is broken, so we have to use electric heaters (youngest was premature and is prone to pneaumonia, so the cold coupled with the damp issues etc here woulod be super bad). So we put £30 pw on elec to cover us, and usually dont hit emergency credit til the day wages go in.
The gas, is weird... they have the meter all listed wrong, they have us listed as prepay meter, but its quarterly, so essentially we've been paying £0 for gas. We've budgeted the £30 pw, to cover our usage when they get it figured out, and also any overuse. If it turns out to be less than £30 pw, thats great, but we've budgetted at a rate that matches the elec for the time being. Also, present supplier is recovering arrears from my past house via these meters, meaning we need to account for slightly more weekly.

The Virgin is a bone of contention... we get TV, BB & phone through them, at "supposedly" £50 pm (was the deal we signed).
However, they've been consistently overcharging us at £100 pm. When we caught onto it, and asked they said "call charges", (we didnt have a phone physically plugged in for 3 months, and still had call charges!) we've requested itemised bills from them, which they promise they're sending. We've downloaded our bill from our account, and will be marking off anything not applicable tomorrow (my only day off this week). And I'm ringing them tomorrow to tell them we're leaving.
My concern is, we've said that before and they just kept reiterating that we're still within contract term and would pay ETFee. Hopefully, the marked off bills will rectify that.

I've only just taken over the accounts, financing, budgetting etc mid november, so I'm still grasping everything. Until then, OH was "dealing" with everything.

sourcrates

I have to say that with two kids in the house, you must spend a fair bit on them, treats, entertainments etc.

I have 3 kids myself so know how much I get through, and I gotta say that £230 surplus may not even cover that, plus you need contents insurance, average is around £15 per month dependant on cover.

Also holiday fund, emergency fund all need something in there.

If you also deduct the payments you need for the essential debts, you could very easily balance that budget to leave less than £50 a month, so qualifying for the debt relief order.

So to sum up, add the payments together for the two council tax debts, plus the debt with the CCJ, add something for entertainment, contents insurance, emergency fund, and holidays, and I bet that £230 surplus has now been wiped out.

mwarby

hunnybeanz wrote: »

Hi mwarby
Thanks for replying. The gas and electric is 120 pcm EACH at the moment, as heating system and boiler is broken, so we have to use electric heaters (youngest was premature and is prone to pneaumonia, so the cold coupled with the damp issues etc here woulod be super bad). So we put £30 pw on elec to cover us, and usually dont hit emergency credit til the day wages go in.
The gas, is weird... they have the meter all listed wrong, they have us listed as prepay meter, but its quarterly, so essentially we've been paying £0 for gas. We've budgeted the £30 pw, to cover our usage when they get it figured out, and also any overuse. If it turns out to be less than £30 pw, thats great, but we've budgetted at a rate that matches the elec for the time being. Also, present supplier is recovering arrears from my past house via these meters, meaning we need to account for slightly more weekly.

The Virgin is a bone of contention... we get TV, BB & phone through them, at "supposedly" £50 pm (was the deal we signed).
However, they've been consistently overcharging us at £100 pm. When we caught onto it, and asked they said "call charges", (we didnt have a phone physically plugged in for 3 months, and still had call charges!) we've requested itemised bills from them, which they promise they're sending. We've downloaded our bill from our account, and will be marking off anything not applicable tomorrow (my only day off this week). And I'm ringing them tomorrow to tell them we're leaving.
My concern is, we've said that before and they just kept reiterating that we're still within contract term and would pay ETFee. Hopefully, the marked off bills will rectify that.

I've only just taken over the accounts, financing, budgetting etc mid november, so I'm still grasping everything. Until then, OH was "dealing" with everything.

If you do end up going for a formal insolvency solution, your existing arrears for services would be included, so wouldn't be paid off via the meter. Obviously this makes estimating the budget that bit more difficult (although my prepay electric meter shows debt recovery rate). It's also likely that in formal insolvency you could break contract with virgin penalty free with any charges for doing so being lumped in with rest of debts(at least I think that's how it's done)

wba31

sourcrates wrote: »

If you also deduct the payments you need for the essential debts, you could very easily balance that budget to leave less than £50 a month, so qualifying for the debt relief order.

So to sum up, add the payments together for the two council tax debts, plus the debt with the CCJ, add something for entertainment, contents insurance, emergency fund, and holidays, and I bet that £230 surplus has now been wiped out.

except solutions are looked at for both parties, husband may look at insolvency option too, council tax debts, CCJ, payments to any utility arrears will stop so will then create a surplus again...

wba31

hunnybeanz wrote: »

Hi mwarby
Thanks for replying. The gas and electric is 120 pcm EACH at the moment, as heating system and boiler is broken, so we have to use electric heaters (youngest was premature and is prone to pneaumonia, so the cold coupled with the damp issues etc here woulod be super bad). So we put £30 pw on elec to cover us, and usually dont hit emergency credit til the day wages go in.
The gas, is weird... they have the meter all listed wrong, they have us listed as prepay meter, but its quarterly, so essentially we've been paying £0 for gas. We've budgeted the £30 pw, to cover our usage when they get it figured out, and also any overuse. If it turns out to be less than £30 pw, thats great, but we've budgetted at a rate that matches the elec for the time being. Also, present supplier is recovering arrears from my past house via these meters, meaning we need to account for slightly more weekly.

The Virgin is a bone of contention... we get TV, BB & phone through them, at "supposedly" £50 pm (was the deal we signed).
However, they've been consistently overcharging us at £100 pm. When we caught onto it, and asked they said "call charges", (we didnt have a phone physically plugged in for 3 months, and still had call charges!) we've requested itemised bills from them, which they promise they're sending. We've downloaded our bill from our account, and will be marking off anything not applicable tomorrow (my only day off this week). And I'm ringing them tomorrow to tell them we're leaving.
My concern is, we've said that before and they just kept reiterating that we're still within contract term and would pay ETFee. Hopefully, the marked off bills will rectify that.

I've only just taken over the accounts, financing, budgetting etc mid november, so I'm still grasping everything. Until then, OH was "dealing" with everything.

If your heating system is broken and you rent you need to get onto your landlords to sort this out. This is potentially costing you more than if it was all working fine, and may straighten out that part of the budget.

I also think you need to get the issue with your gas sorted out. If you have been budgeting £30 a week (thats £130 pcm) how much do you have saved for the gas? If a bill came in tomorrow and you paid it off, then tried to proceed with a DRO this would be classed as a pref payment, and who knows which way the insolvency service would see it (they think that the savings you have accumulated should be split between all debts, despite you budgeting this specifically for the non-existent gas bill - makes sense to all us advisors, but to the IS they see things differently!)