DRO for my situation, or no?

peachbeach

Hi everyone,

I am looking for urgent debt advice. I live in England. I’m in my mid 20’s and do not own a house or a car/any savings or assets. I don't even have many clothing items at the moment as the private accommodation I rent is filled with black mould so I have had to throw away most of my belongings. I am having to sell my other belongings so I can scrape by at the moment, every penny counts and we have to scrape it by to be able to afford to eat each day. I live with my boyfriend who works full-time and has up to now been paying all of our bills/expenses on his minimum wage job for almost two years. I was granted LCWRA by the DWP as I am mentally unwell/suicidal and have a range of disorders like PTSD, OCD and suspected Borderline Personality Disorder. 

I had a great career after I finished University and had to leave it as I became so unwell. I was living and taking out non-priority debt credit to survive and then I was paying off the minimum payments up until I couldn’t afford it anymore. I am in about £8000 worth of debt and have been trying to get advice for it since mid last year but I just keep  getting passed around by each of the charities, I feel like it’s an endless circle. They are pushing for me to get an IVA or a DMP even though we have no income left over with a budget as tight as it can be. National Debtline pushed me into breathing space one month after I began to miss my minimum payments when I first wanted advice even though the creditors hasn’t obviously taken any legal action at that early point. Now I can’t use my breathing space even though this is when I need it the most.

I will be getting £390 a month for my illness until I can be well enough to work again and all of this stress has obviously stumped my progress.

I contacted a different charity today who I saw many suggested on this forum, they have told me to disregard all the help from the others  and we made a new budget together. It is totally different to the one I made with another charity and shows that even with the addition of a new small income, we would have nothing left over. They have suggested a DRO and are telling me to start the application process asap. I just wanted some advice from here first. Will it matter if I have had the other charity pushing for the IVA/DMP send my other signed budget to my creditors already? The lady I spoke with today told me I can seek help from as many charities as I want but I am just so unsure of what to do.

Thanks. 

elsien

As a complete aside to everything else, and apologies for getting slightly off-topic, but you only mention LCWRA.
Are you not getting PIP at all? 

Who is the other charity because I’d be surprised at anyone pushing you towards an IVA in your circumstances.

peachbeach

elsien said:

As a complete aside to everything else, and apologies for getting slightly off-topic, but you only mention LCWRA.
Are you not getting PIP at all? 

all of the charities I have spoken to and CAB have suggested I apply for it but I have not yet as I know it's a long stressful process, so just getting LCWRA at the moment. I tried for ESA when I first became ill as I have worked since I left school but I wasn't entitled

stu12345_2

the dro is £90, very fast decision, the dro is based on what you have left over at the end of the month, eg what%  you contribute to the household bills
eg if you  have only a tenth of the amount you partner brings in , then you put your rent, gas, elec, food as 10% of the TOTAL amount of the bills.
a dro is individually based.
if you have less than £75 left per month. a dro can work for you 
do you think you will be off benefits and into a job in under a year, cos if you do , then the dro will be cancelled at that point you start work  and you be back to square one 

you can do your own breathing space by writing to creditors to explain you cant make the required min payments.

fatbelly

Yes it sounds like a DRO would work for you, and that your latest charity are acting well for you. If they can prepare an application, and it should not be a long process, then they can also fend off any complaints from creditors.

At the end of the day the Insolvency Service will trust the Competent Authority to have examined your situation and presented it accurately.

There are too many advice agencies who are using Breathing Space as a knee-jerk reaction when it is completely unnecessary. And too may who are acting in their own interests by setting quotas for IVAs.

RAS

The demand for help with debt/unmanageable living costs is so much that debt advice services are overwhelmed. So it's harder to get good advice if your situation is more complex.

Is the latest charity a Competent Authority, or do they have a referral relationship with one? Because that means they can prepare the DRO application. It is extremely unlikely to be rejected, although more people are applying so it is taking weeks to get the approval rather than a week. 

Do talk to them about the fact that you hope to apply for PIP, so they can factor that into their advice.

fatbelly

You're being kind, RAS. Debt advice agencies are being overwhelmed but that is at least in part due to FCA/MAPS requirements making advice difficult and driving experienced advisers from their jobs.

There has been another report about it this week, which I will link to if I can.

https://www.i-m-a.org.uk/other-services/social-policy/our-key-campaigns/

Hopefully the op is with an adviser who is still able to function. Pip is not counted as income as long as the adviser is smart enough to realise that

sourcrates

Try and relax, the debt collection process is quite a long drawn out affair, nothing happens quickly, despite what you might envisage, and put aside all thought of legal action, that is not an option at this early stage.

Your debt is not massive, its actually quite small in the scale of things, so forget Bankruptcy/IVA neither is suitable for you, and if those advisors contact you again, tell them you have changed your mind.

Your choice is likely between a DRO and debt management, you may also want to try writing and asking your creditors to just write off your debts due to to your health issues, that is another option.

Alternatively if you qualify for a DRO and are happy to go ahead, then there`s no reason to wait, try and get as much information on the process so you know how it works.

Jack__Bauer

For what it's worth, I have been going through the DRO process this week with Money Wellness after struggling to deal with a bereavement.

I spoke to someone initially on Monday, then spoke to somebody on Wednesday who drafted the application, and once I paid the fee, it was submitted the same day. They have been very good with no judgement whatsoever (they do send a lot of texts and emails, though).

The guy who processed my application said they only submit them if they are virtually certain they will be accepted, and of the 100's he's done, not one has ever been refused.

EssexHebridean

The £90 fee for the DRO was even mentioned in a post further up the thread. 

@BadDebtor - FYI to avoid this situation in the future, DROs, IVAs and bankruptcy all involve fees, they are not like a DMP that can be done for free. I think you owe Jack_bauer an apology to be honest, and if you have spam reported their post, I believe you can click on the spam report button again, to cancel it. 

fatbelly

Jack__Bauer said:

For what it's worth, I have been going through the DRO process this week with Money Wellness after struggling to deal with a bereavement.

I spoke to someone initially on Monday, then spoke to somebody on Wednesday who drafted the application, and once I paid the fee, it was submitted the same day. They have been very good with no judgement whatsoever (they do send a lot of texts and emails, though).

The guy who processed my application said they only submit them if they are virtually certain they will be accepted, and of the 100's he's done, not one has ever been refused.

Thanks, Jack. I suspect Money Well ness is actually the best way of getting these done now, since CAB seem to get their knickers in a twist over the smallest problem.

MaPS funded CAB and Money Wellness to do them, but not Stepchange, which is the point where they threw a strop.

What i didn't realise until this week is that MaPS have funded MW to the tune of something like 30 million* to provide debt advice outside the DRO hub. I've no idea what they do with that money

It was in this but it's a huge download and I can't be bothered to do it on this tablet

https://maps.org.uk/en/publications/consultations-and-responses/2024/consultation-on-MaPS-proposals-for-delivery-of-debt-advice-strategy#

* Edit: just checked, £37 million!