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What is an Administration Order?
An Administration Order is a court order which covers your outstanding debts. Under it you would make a monthly payment to the court, who will then distribute that money on a pro rata basis amongst your creditors.
For administering the order, the court will take 10% of your payment as handling fees to cover their costs, which they will deduct directly from your monthly payments.
Whilst the order is in place no creditor included in the order, without the leave of the court, will be allowed to take action against you. In addition, debt collection procedures and letters against you will be stopped.
Who can apply?
To be able to apply you must have:
This is done by completing form N92 which is obtainable from your local court office.
On the form you must list all your debts, which must not exceed £5,000. Administration orders are only given to individuals, where there are debts with joint and several liability, you should include the whole debt. Even if finances are shared, couples cannot apply jointly and must make separate applications.
Where a couple each make individual applications for an order at the same time and their is a joint debt, it may be acceptable to divide the debt equally between the two applications.
There is no application fee. The only charges levied byt he court will the 10p in every £1 which they deduct to cover their admin costs.
For employed applicants an Attachment of Earnings Order will be made, unless they specifically request otherwise on form N92. Since many debtors do not want their employers to know of the situation, most debtors prefer not to have an Attachment of Earnings Order.
If you do not maintain your payments, the court can revoke the order. Your creditors would then be entitled to pursue you for the full amount owed to them.
Should you feel that you cannot afford to pay the amount stipulated in the order, perhaps because of a change in circumstances, you can ask the court to review the order and reduce the payments.
Once you have paid your debt off under the order, you can obtain a "Certificate of Satisfaction" from the court. You will have to pay a £10 fee for this certificate.
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