DRO & Classic Car Valuation

MaeMobley

Hi there,
I am posting on behalf of my father. Step Change suggests he go down the DRO route because he does not have assets worth more than £2k. His car is a 1993 Daimler that needs a LOT of work on it - currently off road. Money Wellness have looked at Autotrader & say the value should be £8,000 based on the 3 currently for sale. They suggested finding a garage to value it & report that it is worth less than £2k. Does anyone have any advice? if it is found to be worth over £2k do we just go for bankruptcy?
Thanks in advance for help or advice you can provide.

MalMonroe

Hi, what did StepChange say about Money Wellness's suggestion? (i.e. 'Money Wellness have looked at Autotrader & say the value should be £8,000 based on the 3 currently for sale. They suggested finding a garage to value it & report that it is worth less than £2k.')  I'm a bit shocked, as that sounds dishonest to me. 

If the car needs a lot of work and is currently off the road for that reason, what use is it to your father in its current state?

You, or your father, really need to go back to StepChange and discuss this matter further and in greater detail with them because they are the experts and they are the ones who can give your father the correct advice. Not we, on here. Nor Money Wellness, from the sound of it.

Even though I have had a DRO in the past I wouldn't know what to advise your father to do. Bankruptcy is not the same as a DRO - it has stricter conditions and the application fee is much higher than that of a DRO too. (£680 vs £90). It needs careful consideration, which is why it would be best to go back to StepChange. I feel it's a great pity that StepChange is no longer able to act as an intermediary as they helped me through the whole process of my DRO and were excellent.

This is just based on my own experience, thoughts and opinions but it wouldn't hurt to just double-check with StepChange. 

sourcrates

How much does Dad owe, and what kind of debts are they ?

Daimlers (in good nick) hold there value well, and won`t come in under 2k unless its a basket case.

Look on Parkers Guide, as that is what the Insolvency Service normally use to value cars.

Is the car registered to him ?

MaeMobley

Thanks both for your reponses & taking the time to answer. I will contact StepChange & ask their advice. The car is registered to my dad. We have no real idea how much it is actually worth but my dad reckoned less than £2k as it needs a fair amount of work. It has sentimental value so my dad is struggling to let go of it. He has just lost my mother & letting the car go would be seen as another loss. But he cannot afford to be sentimental.
We looked on Parkers but they didn't seem to be able to value anything older than 2003, unless I was looking in the wrong place.

MaeMobley

I missed How much does Dad owe, and what kind of debts are they ?

He owes £10k in 3 loans to Sainsbury's bank.

sourcrates

MaeMobley said:

I missed How much does Dad owe, and what kind of debts are they ?

He owes £10k in 3 loans to Sainsbury's bank.

10k ? that`s not a massive amount, he certainly should not go bankrupt for that.

What kind of income/expenditure does dad have ?

Are the debts all in his name ?

There are other ways and means of dealing with 10k.

Just to clarify, the more info you can give us on his circumstances so much the better.

MaeMobley

@sourcrates thank you. I will post tomorrow morning with more details/ background.

MaeMobley

What kind of income/expenditure does dad have ?
Are the debts all in his name ?
There are other ways and means of dealing with 10k.

My dad is nearly 80. He lost my mother in April. His income has dropped by £900 (my mum's pension + care allowance). His current income (roughly £2,500) is made up of state pension/ private pension/ housing benefit & his costs (roughly the same) are rent/ service charge/ council tax/ general living costs.

He has 3 loans (all in his name) - all with Sainsbury's Bank - totally £10,000.

Re assets - he has this wreck of a Daimler - that may or may not be worth more than £2,000. Not much in the way of cash. 

sourcrates

I`m assuming he can`t afford to service these loans then, is that the case ?

Given your dads age, lack of disposable income, and general circumstances, have you considered writing and simply asking the bank to write off his debts ?

Just had one poster with mental health issues, who was advised to ask for write offs from her creditors, and posting an update today, she has had 8/9 creditors write her debts off completely, quite a few thousand pounds, so it can be done, if you have a strong enough argument, pointing out the alternative might be bankruptcy may focus their attention somewhat, and all for the cost of a stamp.

It`s certainly worth a punt and would be so much easier and simpler than going all out for an insolvency solution.

MaeMobley

Thank you. Sounds daft but no, I hadn’t thought of doing this. You are right. There is nothing to lose. The cost of a stamp.

Thank you for taking the time to respond.

Grumpy_chap

MaeMobley said:

My dad is nearly 80. He lost my mother in April. His income has dropped by £900 (my mum's pension + care allowance). His current income (roughly £2,500) is made up of state pension/ private pension/ housing benefit & his costs (roughly the same) are rent/ service charge/ council tax/ general living costs.

He has 3 loans (all in his name) - all with Sainsbury's Bank - totally £10,000.

Condolences to you and your Dad for the loss of your Mother.
This is all probably a shock and leaves him a bit overwhelmed.  The need to adjust the monthly budget as well as everything else can be hard, particularly with the timing of things.

Can I just my understanding that the figures given (£2.5k) are monthly income?
The debt is £10k total?

Others have given good advice, but there may also be merit in working out a new household budget for your father.  Use one of the SoA tools (Statement of Affairs) that are available in the DebtfreeWannabee sections of this forum.  Doing a fresh budget to reflect the new status-quo will be helpful plus it may identify opportunities for reductions in spend that make the £10k debt manageable.