Individual Voluntary Arrangement (IVA) & Debt Relief Order (DRO) Info, advice and help thread.
DRO (Debt relief Order).
There is info on the net and in the link provided below, but these are the main practical features -
(1) Total debt must be no more than 30k
(2) Must not be a homeowner (not even with neg equity)
(3) Asset limit is now £2000 as well as a vehicle valued at up to £2000.
(4) Monthly disposable income (after all reasonable expenses) of £75 or less.
ONLY the debts listed will be written off. If a debt comes to light that pushes over the 30k limit then the order will be revoked.
The conditions regarding restrictions on employment, borrowing, trading whilst undischarged are all the same as BR.
Debts that can go in to BR can also go in to a DRO.
The DRO period.
Once you get your DRO, you stop making payments towards the debts listed in it.
A DRO lasts 12 months. This is called the DRO period. The DRO period can be extended in some cases.
At the end of the period, your DRO is closed and you will not have to pay your debts back.You do have to keep paying any regular commitments during the DRO period, like rent and bills.
If applicants financial situation improves within the year then the order may be revoked or applicant may be asked to contribute towards debts.
No early discharge.
There is no involvement of the court.
The cost is £90, and is able to be paid in instalments through payzone and post office outlets.
Your details will not be placed in the London Gazette, however your name will appear on the Insolvency register for a period of 15 months.
DRO info is available on insolvency service web site.
You must apply through an intermediary, so advice must have been taken. Intermediary will assist with application, which is on line only. No fee can be charged by any intermediary.
Further information can be found here -
How to get a Debt Relief Order (DRO) - GOV.UK (www.gov.uk)
IVA (Individual Voluntary Arrangement.
IVA`s are only really suitable for a small minority of individuals, mainly those who fit the following criteria -
(1) Should be a homeowner or have significant assets to protect, so cannot go bankrupt,
(2) Should have debts over 30k,
(3) Have a regular source of stable income, as arrangement can last 60 months.
IVA`s have a terrible reputation for being mis-sold to those who are totally unsuited to such an arrangement.
If you don`t fit the above criteria, then it`s likely another option would be more suitable for you.
Unfortunately, regulation is not as tight as it could be in this sector, and debt management companies using their own "inhouse" IP`s can make significant profit from the fee`s charged for these arrangements, which has led to many people being "sold" an IVA when it was totally unsuitable for them.
Always obtain good, independent advice before opting for any regulated debt solution.
More information on IVA`s here -
How to apply for an IVA - Citizens Advice
And if you do decide to have one, make sure you use a recommended IP, such as the one Stepchange use -
IVA - Individual Voluntary Arrangement Advice. StepChange
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