Debt Relief Orders (DRO) - Information & help thread

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  • smallandcute
    smallandcute Posts: 76 Forumite
    edited 8 February 2017 at 7:08AM
    Hi all,

    I have had a good read through this thread and have a quick question as I am still considering a DRO. My uncle sent me £1000 last month to cover my bills due to me being made redundant before Christmas and I am still looking for work. Will the OR or whoever else handles the paperwork contact my uncle to say I now have a DRO in place?

    Also to add I may go into rent arrears (I am a private tenant and have been living in the same place for two years, four months) this month. If it is just this month that I go into arrears and set up a payment plan to pay this off will I need to declare in the DRO or could I not declare it and add the additional payment amount to my total monthly rent? I cannot leave where I am currently living due to having pets, my age (I would not qualify for a one bed place due to age if I was to go into social housing) and I cannot go into shared accommodation due to other reasons.

    Thanks for all the great support and advice here.
  • fatbelly
    fatbelly Posts: 20,380
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    Hi all,

    I have had a good read through this thread and have a quick question as I am still considering a DRO. My uncle sent me £1000 last month to cover my bills due to me being made redundant before Christmas and I am still looking for work. Will the OR or whoever else handles the paperwork contact my uncle to say I now have a DRO in place?

    Also to add I may go into rent arrears (I am a private tenant and have been living in the same place for two years, four months) this month. If it is just this month that I go into arrears and set up a payment plan to pay this off will I need to declare in the DRO or could I not declare it and add the additional payment amount to my total monthly rent? I cannot leave where I am currently living due to having pets, my age (I would not qualify for a one bed place due to age if I was to go into social housing) and I cannot go into shared accommodation due to other reasons.

    Thanks for all the great support and advice here.

    Hi.

    The £1000 wasn't a loan, it was a gift from what you say. It would not feature on the DRO.

    That sounds like private rented accommodation. If you are in arrears with your rent that should go in as a debt. Rent arrears are unusual in that you are allowed to keep making payments while on the DRO if it relates to the place where you live. It should not affect your tenancy as it is in the landlord's interest to keep you in the property so he can collect the rent.

    If he evicted you he would not be allowed to collect on the rent arrears as they would then relate to a former tenancy.

    Having said all that it may be neater to catch up with your rent quickly as it is a priority debt, and keep it out of the DRO.
  • fatbelly wrote: »
    Hi.

    The £1000 wasn't a loan, it was a gift from what you say. It would not feature on the DRO.

    That sounds like private rented accommodation. If you are in arrears with your rent that should go in as a debt. Rent arrears are unusual in that you are allowed to keep making payments while on the DRO if it relates to the place where you live. It should not affect your tenancy as it is in the landlord's interest to keep you in the property so he can collect the rent.

    If he evicted you he would not be allowed to collect on the rent arrears as they would then relate to a former tenancy.

    Having said all that it may be neater to catch up with your rent quickly as it is a priority debt, and keep it out of the DRO.

    thank you so much for your reply Fatbelly! confirmed what I had thought.
  • Hi,
    Anyone know how this could affect my DRO? I'm three months from the DRO being fulfilled, but have recently had a car accident (not my fault). My car was valued at £850 by the DRO person. The insurers (Direct Line) have offered me £1050 saying that's the lowest price they offer everyone. Ordinarily, if I wasn't in the DRO situation I'd haggle the price up, but do I need to haggle it down to £1000?
    Apologies if I've put this in the wrong place, hurrying.
  • fatbelly
    fatbelly Posts: 20,380
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    Crooklock wrote: »
    Hi,
    Anyone know how this could affect my DRO? I'm three months from the DRO being fulfilled, but have recently had a car accident (not my fault). My car was valued at £850 by the DRO person. The insurers (Direct Line) have offered me £1050 saying that's the lowest price they offer everyone. Ordinarily, if I wasn't in the DRO situation I'd haggle the price up, but do I need to haggle it down to £1000?
    Apologies if I've put this in the wrong place, hurrying.

    There are two issues:

    1. Was the car incorrectly valued? Not necessarily. Though I find it difficult to accept that Direct Line offer everyone a minimum of £1050. Might be worth buying A £50 one and crashing it

    2. You now have a lump sum of £1050. The guidance says:
    Where the value of the property, including lump sum payments, is between £1,000 and £1,850, each case will be assessed on its own merits taking into consideration numerous factors, including but not limited to liabilities, health, personal circumstances, age, etc. and a decision will be made on an individual basis as to whether it would be appropriate to revoke or not.
  • Mra199
    Mra199 Posts: 21 Forumite
    I need help. I am currently in the process of sorting my debts out. I have a lot of creditors, 16/17 in total. Just under £13000 outstanding consisting of catalogues, payday loans unsecured loans and telecom. None of this was intentional and happened for unfortunate serious reasons. I am currently living with my partner and our baby under 1. My partner works full time but no contract and his shifts vary so does his pay. I am currently unemployed after mat leave and will be returning in August. At first we were advised a DMP which will take 10+ years to clear. That was as a joint budget. Going off my own share of the bills and my income (which is only benefit related) I have been advised a DRO. Looking at the criteria it seems I do qualify however there are a few things I'm unsure about and would really appreciate anyone's helps before I go through with the app. Creditor preferences? I am not sure what this means, there are outstanding balance I haven't even been able to make minimum payments to whatsoever and there is a doorstep lender I have which I haven't missed a payment for. Is this a preference? Also there is a very recent payday loan which I took because my partner was laid off at work and we had no income, he was to return to work the end of that month but then laid off again so hasn't been one payment made? Is this intentional debt and can I be refused for these reasons? I would really appreciate any advice!
  • I suspect the £1050 minimum payout statement was a glib effort by the claim handler to just get me off the phone.
    Valuation was originally done via Parkers website I think. I had no hand in it.
  • fatbelly
    fatbelly Posts: 20,380
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    Crooklock wrote: »
    I suspect the £1050 minimum payout statement was a glib effort by the claim handler to just get me off the phone.
    Valuation was originally done via Parkers website I think. I had no hand in it.

    Yes, the valuation has to be done (if possible) on Parkers' site. So it sounds like the original valuation was done correctly.

    If Direct Line were to offer you £850 there would be no issue on either count.
  • fatbelly
    fatbelly Posts: 20,380
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    Mra199 wrote: »
    Looking at the criteria it seems I do qualify however there are a few things I'm unsure about and would really appreciate anyone's helps before I go through with the app. Creditor preferences? I am not sure what this means, there are outstanding balance I haven't even been able to make minimum payments to whatsoever and there is a doorstep lender I have which I haven't missed a payment for. Is this a preference? Also there is a very recent payday loan which I took because my partner was laid off at work and we had no income, he was to return to work the end of that month but then laid off again so hasn't been one payment made? Is this intentional debt and can I be refused for these reasons? I would really appreciate any advice!

    I wouldn't worry about it. The sense of the question is 'have you paid off one creditor knowing that you were going to do a DRO on the others?' Having said that, in the run-up to a DRO you should treat them all equally, and the best way to do that is to pay none of them. So stop paying the doorstep lender and don't pay the payday lender.

    The exception to this is rent arrears, which you are allowed to make payments to. TV licence is not a qualifying debt and obviously if you have car insurance or any joint financial product, then it makes sense to keep paying those.

    Feel free to ask if you have any other problems, but your intermediary should be able to answer any questions.
  • Mra199
    Mra199 Posts: 21 Forumite
    Thank you so much for your response. That makes much more sense, I did pay the doorstep lender off in full early last year because of pressure but I had no idea about a DRO then or any debt remedy and obviously since then renewed the loan much to my discretion... When things got bad and I was unable to make payments to creditors I only made the payments to him again because of pressure. I will take your advice and treat them all the same as of now. Thank you!
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