DRO - circumstances change

sallymanton

Hiya all
I'm doing some research in to a DRO, which I may go down this route, rather  than bankruptcy just not sure.I read it says after the 12 months 'if your circumstances change' then debt will be written off, well if I went ahead and applied for this, then my monthly payment to stepchange will stop (currently on a DMP) so therefore I'm instantly better off. Would that mean I would have to contribute to my debt again, even if my monthly income stays the same at time of application? I'm so confused please help.

sourcrates

Hi,
Yes you are confused.
To qualify for a DRO you must ~

(A) not be a homeowner
(B) have 20k of debt or less
(C) not have a car or assets worth more than £1000
(D) not have more than £50 disposable income, not including debt repayments.

Basically if your paying stepchange more than £50 a month, you won’t qualify for a DRO.

In a DRO you make no payments, then after 12 months, if your circumstances have not changed, your debts will be written off.

sallymanton

Thank you, that's the bit that confused me, is the if my circumstances haven't changed my debt will be written off...
I do quality for a DRO, based on everything you have said , just didn't know what would happen to the money I pay stepchange at the moment. 🤔🤔

fatbelly

There's a £90 upfront fee then that's it. No further payments. If you have surplus income (less than £50 per month) then save it  - you are allowed up to £1000 'assets' on entry to a DRO and the rule is a bit looser once you are in it (but best to keep it below £1000)

sallymanton

Thank you, I couldn't work out if they would take the money I pay stepchange of me as well, so at least I would have something to play with. 

sammyjammy

How much are you currently paying Stepchange?

sallymanton

Once I have updated my budget review it will be £35 a month