Debt Relief Order advice please

Splodge1000

I have been liaisng with the CAB and hope to apply for a DRO through my local branch.

One further question. I previously declared myself bankrupt (this was 13 years ago and I was discharged within six months). Will this affect whether a DRO is granted, ultimately? I know that the applicant must not currently be involved in bankruptcy but what about a previous one? This is of course no longer on my credit file but no doubt the Insolvency Service have their own records which go back further.

StopIt

No. You can't apply for an IVA or DRO within 6 years of the last one I think but aside from that it wont make any odds after 13 years. You may have to declare it (Not seen the form, one for Fatbelly that), but it wont be any barrier to you.

Splodge1000

Thanks, Stopit.

I have some paperwork from the CAB which states a previous bankruptcy as a factor which may affect eligibility or suitability for a DRO which is why I was concerned.

sourcrates

Splodge1000 wrote: »

Thanks, Stopit.

I have some paperwork from the CAB which states a previous bankruptcy as a factor which may affect eligibility or suitability for a DRO which is why I was concerned.

It wont stop you from been granted a DRO.

They will ask the reason why you need to resort to insolvency again though, just be honest, in my case it was a marriage breakup.

It was accepted fine.

fatbelly

StopIt wrote: »

Understood!


Is that a case of reality hitting hard here? I remember people here stating that a DRO wouldn't be advised for those with negative surplus because it was only available for use every 6 years and if you're still losing money, it would mean that a few years down the line the person would be in debt AND unable to use this facility.


Of course, that didn't make 100% sense either, as it meant turning people away who still needed support.


Are we going to see more of this happening thanks to the rollout of UC going forward. As you said, lots of people reliant on benefits have negative surplus already, what's going to happen when they get squeezed even further with UC?

This is right. We are planned to go live for UC on all new claims over the next 3 months in my area. We are expecting problems. I think the BBC were throwing around a statistic that 84% of UC claimants have rent arrears.

Splodge - let's hope your local CAB does the job for you

Splodge1000

Thanks, sourcrates and fatbelly.

In my case the problems have arisen from trying to keep my online business afloat. I was putting money in from credit cards and then using one to pay the other - robbing Peter to pay Paul - until it got out of hand.

sourcrates

Sure all will be fine matey !!

Splodge1000

sourcrates wrote: »

Sure all will be fine matey !!

I am not so sure that it will, sourcrates, as I have learned something this morning which is disturbing.

One of my creditors had placed a 30 day hold on my account. This has now been extended by a further 30 days. The creditor explained to me previously that charges and interest would be frozen during this period. They now say that this is not the case, charges and interest are being applied.

The danger is that this may take me over the £20,000 threshold and make me ineligible for a DRO. If the other creditors who also reported freezing my accounts follow suit then I will exceed the £20,000 limit.

Edited to add: my creditors are not aware that at present I am seeking a DRO.

StopIt

Splodge1000 wrote: »

I am not so sure that it will, sourcrates, as I have learned something this morning which is disturbing.

One of my creditors had placed a 30 day hold on my account. This has now been extended by a further 30 days. The creditor explained to me previously that charges and interest would be frozen during this period. They now say that this is not the case, charges and interest are being applied.

The danger is that this may take me over the £20,000 threshold and make me ineligible for a DRO. If the other creditors who also reported freezing my accounts follow suit then I will exceed the £20,000 limit.

Get in contact with all of the creditors who you have this agreement and make sure they're being held as agreed.


If you go above the DRO limit, you'd be looking at Bankruptcy I'm afraid. Of course that has a higher fee, but the outcomes are basically the same.


Make sure to get exact totals for your debt to see if you're indeed skating a bit too close to the limit here.

Splodge1000

StopIt wrote: »

Get in contact with all of the creditors who you have this agreement and make sure they're being held as agreed.


If you go above the DRO limit, you'd be looking at Bankruptcy I'm afraid. Of course that has a higher fee, but the outcomes are basically the same.


Make sure to get exact totals for your debt to see if you're indeed skating a bit too close to the limit here.

Thanks, StopIt. I will do that.

Not all of my four creditors agreed to this initially. The one who didn't (MBNA) would not put a freeze on the account and I believe they have a reputation for making debtors bankrupt.