Soa - dmp, dro?

2ndTimeAround

Please cast an eye. I can't copy and paste it unfortunately. We'd prefer DMP, but suspect we don't have enough surplus without cutting til it's unmanageable. Other option is fractionally up our expenditure to bring us under the £50 surplus. Cant afford the huge bankruptcy fees. Already expecting hassle as we have previously been bankrupt (I know )
Thank you

Adults 2 (1 employed FT, 1 self employed but not making any money)
Child 1 (age 6)
1 dog 2 cats
Private rent
1 car (worth £500, no finance)

Monthly take home income: 1245
Benefits: 388
Total 1633
Groceries (inc pet food, toiletries, cleaning) 300
Rent 595
Council tax 119
Elec 60
Gas 20
Water 25
Tel 10
Mobiles 20 (Already SIM only)
Internet 20
Clothing 10
Petrol 60
Road tax 17
Car ins +breakdown 36
Car mot+maintenance 25
Bus fares 5
School trips/events/photos 5
Pocket money 5
Child swimming lessons 25 (we live on the coast so feel it's important for him to learn ASAP in case of accident)
Prescriptions 10
Dental/opticians 18
Pet ins/vets 30
Contents ins 10
Life ins (not sorted yet so guessing) 20
Presents 10
Hair 10
Entertainment 25 (Yoga class to help me lose weight)
Emergency/repair 25
Political party membership 4
Union 13
Total Out 1570

Available to pay debts £63 a month

Debts
Credit card £4500 £50 a month
Loan £11000 £229 a month

National_Debtline

Hi 2ndTimeAround


Your outgoings all seem reasonable and I agree it would difficult for you to reduce them further. Currently a DMP would take around 20 years so I think we can rule that out.


A DRO seems a much more likely option. Bear in mind you only apply as an individual but your budget sheet is showing you have £63 per month spare as a couple. That means as an individual you almost certainly already have less than £50 per month spare for your debts. In which case you won't need to make any changes to the SOA.


I'd recommend contacting one of the free debt advice agencies to discuss the DRO further. I hope it all goes well.


Susie
@natdebtline

2ndTimeAround

Is it likely to be a big problem that we had a previous bankruptcy in 2009? I can't believe we managed to get ourselves in this state again

anna_1977

Hi,
is there any way your OH can get an employed wage rather than SE? I know this is easier said than done at times though

Have you also checked your benefits, that doesn't seem a lot for low income. Are you entitled to council tax benefit or housing?

Good luck - sorry I can't give any advice on the bankrupcy

2ndTimeAround

It's actually the other way around, I'm the self employed one, the debts are all in his name because I haven't had any earnings. He works shifts between 8 am and 9pm, 5 in 7 days, on a 3 week rolling Rota. There's no day or time I can reliably be sure I have childcare for except for 10am-2pm Monday to Friday term time only. Those jobs are almost impossible to find in my area. I also can't drive as I'm epileptic. Every time I try to get my license back to start to learn to drive I have a seizure and lose it again. I'm in a rural seaside area, so public transport is infrequent and expensive, which also limits down my work choices.
I'd love to be able to make an income from my business but it's slow going.

sourcrates

2ndTimeAround wrote: »

Is it likely to be a big problem that we had a previous bankruptcy in 2009? I can't believe we managed to get ourselves in this state again

No, it won’t make any difference, they will ask you why you went bankrupt, as long as you have a valid reason, it will not be questioned.

enthusiasticsaver

I agree that you don't have enough surplus for a DMP. It would take forever to clear it. Does not seem much to cut on expenditure either without taking it very close to the bone.

2ndTimeAround

I guess DRO it is then. So angry with us for letting it get this bad.

Is it better to tell creditors we're struggling and talking to debt charities to buy us a couple of months to build an emergency fund?

Will we lose our (not linked to any debt) current account? Only hubby will actually have the DRO, but it's a joint account

Thank you

2ndTimeAround

Also, when working out SOA should I be doing the full household figure? I have no earnings, but child benefit and child tax credits are paid in my name

sourcrates

Debt relief orders are unique to the individual, so as long as the budget you use shows a £50 or less (preferably less) surplus at month end, it will be accepted.

As long as there is no debt which will be included in the DRO associated with the joint account, it should not be affected, although it could reflect on your credit history.

Informing your creditors of your situation is a good idea, nothing will happen for a good while anyway, debt collection is a long drawn out affair, plenty of time to save up an EF.

2ndTimeAround

So far we haven't missed any payments but will do at the end of the month.

I'm worried we'll be in trouble because when hubby inherited £2.5k last autumn we used £500 to clear his Argos card. The theory was if we paid off the smallest debt we could use that monthly payment to help clear other debts a little quicker, but it didn't work out. The rest was mostly used on plugging the income gap to help us stay on top of the debt payments