Urgent advice please!

Terri65

I have spoken to National Debtline today and they are helping me with a DRO.

The week before last I tried to sort my problems out myself and make offers to pay, unfortunately I was going through a phase of depression and seriously over comitted myself.

One is to the HMRC for benefit overpayment, I offered £40 a month and the other is a county court judgment at £16 a month.

The HMRC payment was due to come out today but I panicked last night and cancelled the direct debit.

Do I ring them and tell them I'm waiting for the DRO paperwork? Or try to re negotiate? I've no idea where I would get the money from.

And if I pay the court payment will it look like I'm making a preferred payment?

Thank you for reading

debt_doctor

A preference is defined in the Insolvency Act 1986 as "A payment, other than in the ordinary course of business, with a view to improving that creditors position if you become insolvent."


So the payment has to be above the normal payment AND you must have made it to 'look after' a particular creditor.


Almost always preferences are about paying friends and family back - they rarely apply to an ordinary creditor.


If the court order is £16, then to pay that is not a preference, and the tax credits issue, you may wish to inform them of your position financially, but HMRC don't tend to act quickly so you are likely to have your DRO before any sort of recovery action taken.


DD