DRO and HP finance
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jonjon123
Posts: 57 Forumite
Hi can anyone please advise what happens if you apply for a DRO and you have up to date outstanding finance through a HP agreement on PCP?
Do you lose your car?
Secondly I'm not too sure what my exact debt level is, but if it were to be above £20k, I'm right in saying you cannot apply for a DRO, is that right?
What options do you therefore have if you owe more than 20K, apart from bankruptcy obviously, which I don't really think is worth while for the sake of maybe 25k.
All help greatly appreciated.
Do you lose your car?
Secondly I'm not too sure what my exact debt level is, but if it were to be above £20k, I'm right in saying you cannot apply for a DRO, is that right?
What options do you therefore have if you owe more than 20K, apart from bankruptcy obviously, which I don't really think is worth while for the sake of maybe 25k.
All help greatly appreciated.
0
Comments
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Hi,
You cannot have a car worth over £1000, or any assets worth over £1000 in a DRO.
The upper debt limit is 20k.
Other options are IVA (individual voluntary arrangement) or DMP (debt management plan).
Post an SOA to see which would be best for you.
http://www.stoozing.com/calculator/soa.phpI’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter0 -
sourcrates wrote: »Hi,
You cannot have a car worth over £1000, or any assets worth over £1000 in a DRO.
The upper debt limit is 20k.
Other options are IVA (individual voluntary arrangement) or DMP (debt management plan).
Post an SOA to see which would be best for you.
http://www.stoozing.com/calculator/soa.php
Just tried uploading it and spent half hour doing it for it to be deleted, great.
To cut a long story short because im not doing it all again, I earn about 24k a year and after income/living expenses and priority bills, paying off my HP, Loans and Credit cards I am left with about £40 a month disposable income.
Obviously I would like a quick way out and paying these back over 7 years or longer and taking out IVAs or DMP's will also drag it out also, so because the debt level is over 20k is my only option, literally bankruptcy?
Any suggestions?0 -
Debt repayments are not included in your income and expenditure.
You only include essential payments, no debt repayments, so your disposable income is likely to be a few hundred, so a DRO is out as well.
If you do not take the option of an IVA or DMP then Bankruptcy is all that is left.I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter0 -
sourcrates wrote: »Debt repayments are not included in your income and expenditure.
You only include essential payments, no debt repayments, so your disposable income is likely to be a few hundred, so a DRO is out as well.
If you do not take the option of an IVA or DMP then Bankruptcy is all that is left.
Really?
So even if you pay out loans, credit cards and HP finance, none of them count?
I assume you are just talking about priority bills then?0 -
Really?
So even if you pay out loans, credit cards and HP finance, none of them count?
I assume you are just talking about priority bills then?
In a DRO only your everyday living expenses and essential payments are included in your budget.
A DRO is designed for people who simply cannot afford to service their debts at all, ie, they do not have enough disposable income.
That’s why the disposable income threshold stands at £50.
If you have disposable income, which it appears you may have, then you can afford to pay something towards your debts.I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter0 -
sourcrates wrote: »In a DRO only your everyday living expenses and essential payments are included in your budget.
A DRO is designed for people who simply cannot afford to service their debts at all, ie, they do not have enough disposable income.
That’s why the disposable income threshold stands at £50.
If you have disposable income, which it appears you may have, then you can afford to pay something towards your debts.
I see. Thanks for that.0
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