A reader asked:
I’m a single parent and have had about 10k of debts in a debt management plan for several years. I’m on low income and it looks like it will never end plus I have got some further debts. Now I’m considering a Debt Relief Order (DRO).
But I met someone and I’m thinking about starting to live together. I don’t want to tell him about my debts and really want to sort this out myself.
I am worried if I start to live with him during the period of 12 months. He earns more but also pays his debts and child maintenance. Will my debts become his debts if we decide to be proper partners? What will happen to my DRO?
A very long DMP is not a good idea
If you have been getting further debts, it is probably because you are paying too much to your DMP at the moment. You may be able to get your monthly payments reduced but that would make your DMP even longer… so it’s a good idea to be looking at alternatives.
So talk to your DMP firm, they will be able to check whether you meet the DRO criteria. I’m going to assume here that you do.
How would a DRO affect your new partner?
It’s natural to want to sort your debts out yourself and get this underway before moving in with a new partner.
But I think you should both have an open discussion about money. You know he has debts himself – he isn’t likely to faint with horror because you have!
You aren’t telling him because you want him to help with your debt, but because you want to be honest about your situation. It would be good if he can do the same with you.
So some facts to tell him are:
- your debts will never become his debts – not if you move in together, not even if you get married!
- in a DRO, he won’t be expected to pay your debts, just that he should contribute his share of the household expenditure. And that would also be fair in your current DMP.
- a DRO will harm your credit record but that won’t affect his credit record, even if you live together, unless you have a joint account… so that is best avoided.
How will your new partner affect a DRO?
DROs are not intrusive debt solutions – your spending isn’t monitored, you don’t have reviews. But you do have to inform the Insolvency Service if your income changes or your expenses change a lot.
If that means you no longer meet the DRO criteria, your DRO could be revoked. So you are right to think about whether this will happen.
Your situation is likely to change a lot if you start to live together, whether you move in with him, he moves in with you or you rent somewhere new together.
Typically it’s cheaper for two people to live together than both have separate places. But you may get a lot less benefits because they will be affected by his income, so you may still be entitled to have a DRO when you are living together. You can use the Turn2us calculator to estimate what might happen to your benefits.
I think you need to take debt advice about what your options are now – as I said I have assumed you pass the DRO criteria – and how this may change when you are living together. Fr you the obvious place to start is your current debt management firm. For anyone else reading this, here is a list of good places to get advice.