DRO rejection

Kscott83

Hi, 
I have got myself into a complete panic! 

We have applied for a DRO through StepChange. 

I have admitted we payed one debtor but not others, so preferential treatment, the only reason for this was we had enforcement agents hounding us and they are scary and just don’t give up!
So made a payment arrangement with them which we have been paying monthly....but not all debt cleared to them, no where near!

Will my DRO be refused for this reason? 

I’m completely panicking about it all...StepChange stated it may effect the application, I really hope it doesn’t as what else could I have done? 
Any experience in this anyone? 

mwarby

Not necessarily, preferential payments are more of a problem when its done for a benefit to you, or your friends and family

It's quite common I suspect to find that especially in past that payday loan providers get a bigger slice of income, as they were quite aggressive at charging debit cards, this would mean that other direct debits say would fail. That's not a preferential payment really

What is a problem is say you owe £30k on cards and £5k to family, you stop paying cards but continue to pay family off at say several hundred a month. This is a preferential payment, and is seen as being unfair on other creditors, you are consiously chosing to put one creditor in a better position than the others

In your case I wouldn't be unduly worried, but by all means ask stepchange, they might do better at putting your mind at ease

Kscott83

Many thanks for your reply. 

Hopefully is shouldn’t be an issue, as surely StepChange would say something before submitting 🤔

mwarby

Stepchange will also try not to submit DROs which have a high chance of failing, it reflects badly on them

Kscott83

It was all fine in the end....DRO granted yesterday 😊.