An Administration Order is a good way to sort out all your debts. It can mean:
- One monthly payment at your local County Court
- No more interest on your debts
- Debts written off in some circumstances
- No more legal action
What is an Administration Order?
An Administration Order is a type of insolvency handled by the County Court. All your debts are put together, you make one affordable payment to the court every month, and this money is then paid to your creditors by the court.
Who can apply for an Administration Order?
You can apply for an Administration Order if:
- You have total debts of £5000 or less
- You have at least two debts
- You have at least one County Court Judgment or High Court Judgment
What if my debts are more than £5000?
You can still make an application but, in practice, it is unlikely that the court will make the order. Get help from a Debt Adviser.
How do I apply?
You need to fill in form N92, application for an administration order, (external website / pdf document) available online on the Court Service website. You can complete and then print off the form. You should also look at form N270, Administration Order notes for guidance, (external website / pdf document) which tells you how to fill in the form.
You can also get the forms from your local County Court:
Manchester County Court
Manchester Civil Justice Centre
1 Bridge Street West
M60 9DJ
Tel 0161 240 5000
Will it cost anything?
The court will not charge you to make the application. However, if an order is made, it will take 10p from every £1.00 you pay. This extra 10% will be added to your total debt and does not have to be paid upfront. However, if the court makes a composition order (see below) it may well end up writing off more of your debt than you pay in charges.
Which debts should I include on the application form?
You have to list all your debts on the form. For mortgages, maintenance, child support, hire purchase, you should only write down the arrears owing. If you have any joint debts you have to put down the full amount or the full arrears owing. If you are adding gas or electricity arrears to an administration order it is likely you will be asked to have a pre-payment meter fitted.
TIP: If you have rent or mortgage arrears, get help from a Debt Adviser before you fill in the application form. In some cases, if you ask the court to include a housing debt on an administration order, it could lead to the landlord or lender threatening your right to stay in the property.
How much should I offer to pay each month?
You will have to put details of your incomings and outgoings on the application form. This should help you to work out how much money you can afford to pay. Make sure you have included enough for food and housekeeping. The golden rule is not to offer more than you can afford, even if this means you only offer a low amount. Some orders have been made in Manchester as low as £2 per month, but it would be more usual for someone on a low income, for example someone on income support, to be asked to pay £5 per month.
How long will I have to pay for? - Composition Orders
In some cases you will have to pay until the entire amount owed on the order has been repaid in full. If this is likely to take many years you can ask the court to make something called a 'composition order'. This is where the court agrees to let you pay off a percentage of the debt only.
For example: if you can only afford to pay £5 per month but you owe £3500, the court might allow you to make payments at the rate of £5 per month for 3 years only. This means you will pay £180 in total. The outstanding debt will then be written off after the three years.
How do I ask for a composition order?
You should put the request in writing on form N92. Use the box in Section C that asks if you want the court to take anything into consideration.
Sometimes the court says it will consider making a composition order after 6 or 12 months. You should make payments as normal and then, if you do not hear anything from the court, write and ask for the order to be reviewed.
What should I do when I've filled in the form?
You should take it to the County Court to hand in. In Manchester, the court is on Bridge Street West. The court office is on the right of the entrance on the ground floor. You have to take the form in yourself because you'll be asked to sign the form and swear an 'affidavit' before the court officer. This means you will have to state out loud that the contents of the application form are true.
You should remember to take your County Court or High Court Judgment letter with you, as the court officer will ask for proof of this. The court might also ask to see proof of your other debts so take as many letters as possible.
TIP: Before you hand in the form try and get a copy made for you to keep.
What happens after I've handed the form in?
A copy of the form will be sent to all your creditors. They will be asked whether they object to being included in the order. If none of the creditors object, and the District Judge agrees, the court will make the administration order and you will be sent a notice to tell you of this. If any of the creditors do object or the District Judge is not happy about something, the court will arrange a hearing, which you should try and attend.
What happens if I have to go to a hearing?
The hearing will take place in the District Judge's chambers. This means it will be private and informal.
If your hearing is at Manchester County Court you should turn left after you have entered the court building, and go up the stairs to the first floor. The waiting room is on the right at the top of the stairs. Alternatively you can take the lift, which is also on the left when you go in on the ground floor. The waiting room is on the left as you get out of the lift on the first floor.
You need to book in with the court clerk who will call you when the Judge is ready. You should try and go 15 minutes early in case some of the hearings before you have been cancelled and your hearing is called sooner than its allocated time.
Any creditor who has objected to the order will be invited to attend the hearing. You can also take a representative with you if you are feeling nervous about attending. Get help from a debt adviser.
At the hearing, the District Judge can decide to make the order as it appears in your application, leave some creditors off the order, change the amount you have offered to pay, or not make an order at all.
How do I know if the order has been made?
If you attend a hearing the District Judge will tell you what order s/he is going to make. You will then receive a copy of the order through the post. You will also receive a copy of the order if it has been made without a hearing. The letter will tell you how much to pay each month and when you should make the payments.
How will an administration order affect my creditors?
Your creditors will not be able to take any further action against you without first getting permission from the court. This means you should stop getting letters, visits and phone calls. Also, all interest on your debts will stop once the order has been made.
How will an administration order affect my credit record?
Because you have to have a county court judgment to get an administration order, your name will already be on the Register of County Court Judgments. Lenders and other organisations can look on the Register because it is a public record. It is often used by organisations when they are deciding whether or not to give someone credit. The administration order will also go on the Register and will stay on for 6 years.
If you pay off the administration order you can get a certificate from the court to prove this. This currently costs £10 and is called a 'certificate of satisfaction'. Your record on the Register will be altered to show that the order has been paid but it will not be taken off the register until the end of the six years.
Problems with Administration Orders
What if my creditors still contact me?
If any of your creditors continue to contact you it's a good idea to send them a copy of the order. It might be that the debt has been passed to a debt collection agency and the people there are unaware the order has been made. If the creditor then continues to contact you, rather than the court, you should complain to your local Trading Standards Office. If you live in Manchester, the telephone number of Trading Standards is 0161 234 1555.
What if I can't afford the original payment rate set by the court?
You can ask the court to reduce the payments. You need to do this by filling in form N244 general application notice (external website / pdf document). There is a fee for making this application but you should ask the court to have the fee reduced or written off altogether. To do this you will have to complete another form, form EX160, application for a fee exemption or remission (external website / pdf document). For more information about who has to pay court fees look at Court fees - do you have to pay them? (external website / pdf document)
What happens if I don't make the payments?
The court will write to you to say it is going to cancel or 'revoke' the order. If the order is cancelled, your creditors can start to ask you for repayments once again.
Can I add other debts to the order once it has been made?
You can apply to add other debts but you will need to explain why they weren't included on the original application. If the debt is a new one, built up since the order was made, the court is likely to take a dim view and could decide to cancel your administration order altogether. It is unlikely that the court will add new debts if they take your total over the £5000 limit.
To add debts to an administration order you should write to the court and ask for the order to be reviewed. Explain how the debt has arisen.
What if my circumstances change and I want to pay more or pay less?
Write to the court, say that your situation has changed, explain that you want to pay more or pay less and ask for the order to be reviewed.
More information about Administration Orders
The National Debtline
Based in Birmingham, this organisation has produced a factsheet about Administration Orders.
Need more help? Live in Manchester? Send us an email
Information Provider:
Manchester Advice
Date Reviewed:
16 November 2008
This information is for guidance only and is not an authoritative statement on the law. Please read our Terms and Conditions.
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