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Debt Relief ORder

What is a Debt relief Order?

A Debt Relief Order or DRO is like a form of 'Mini-Bankruptcy' that was introduced in 2009. The purpose of a Debt Relief Order is designed to be a cheaper, simpler and quicker alternative to Bankruptcy; for people who have few or no assets.

Read on to find out more about a Debt Relief Order or fill in the form and one of our advisors will contact you to advise on your options for dealing with your unaffordable debts.

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Debt Relief Order Questions and Answers

There are certain criteria involved in doing a Debt Relief Order which will determine if it is a suitable solution for you.

In England & Wales

  • Your Debts must not exceed £30,000.
  • Your assets must not exceed £2,000.
  • A vehicle is allowed providing it is not of a value higher than £2,000.
  • Your disposable income must not exceed £75 per month. (Disposable income is the amount left over each month after all living expenses and bills have been paid (but not including your debt repayments).

In Northern Ireland

  • Your Debts do not exceed £20,000.
  • Your assets must not exceed £1,000.
  • A vehicles is allowed providing it is not of a value higher than £1,000.
  • Your disposable income must not exceed £50 per month.

You must also be unable to pay your debts (classed as insolvent) and not have been subject to a DRO in the past 6 years.

There is a fee payable to The Insolvency Service of £90 for doing a Debt Relief Order. It can be paid in instalments but must be paid before the application can be made.

You cannot have been involved in another Insolvency Procedure at time of application of the Debt Relief Order. i.e... You cannot be:

  • An undischarged Bankrupt
  • In an IVA
  • In a Bankruptcy Restrictions Order
  • In a Debt Relief Restictions Order
  • In an Interim Order
  • Involved in a pending Debtors Petition for Bankruptcy where the court has not referred you to a Debt Relief Order as your most suitable method of Debt Relief
  • Involved in a Creditors Petition for Bankruptcy where you have not obtained the creditors permission to enter into the Debt Relief Order
  • Your debts will be written off at the end of the Debt Relief Order, with exceptions.
  • Creditors involved in the Debt Relief Order application cannot take any further action against you, without court permission.
  • A Debt Relief Order is complete after 1 year.
  • The fee for applying for a Debt Relief Order is a lot more affordable than the fees for Bankruptcy and can be paid in instalments before the application is made.
  • You can keep your assets (not exceeding £2,000) and a vehicle (not exceeding (£2,000) in England and Wales
  • You can keep your assets (not exceeding £1,000) and a vehicle (not exceeding (£1,000) in Northern Ireland
  • Only an approved intermediary can put through a DRO for you. They will ensure that you are sutiable and fit the criteria required for a DRO.
  • Your Debt Relief Order is entered on a public register.
  • Only an approved intermediary can complete a Debt Relief Order i.e. Citizens Advice Bureau.
  • You cannot have a DRO if you are a homeowner.
  • You will still be responsible for paying certain debts - such as Student Loans, fines and debts arising from family proceedings.
  • Your employment could be affected
  • Your DRO could be withdrawn if you do not cooperate with the Official Receiver during the year that your DRO is in place.
  • You cannot act as a company director or manager unless the court agrees.
  • You will be committing an offence if you obtain credit of £500 or more without disclosing that you are subject to a DRO.
  • You may have a Debt Relief Restrictions Order made against you if you have behaved irresponsibly, recklessly or dishonestly.

Need help with your debts?

If you need some help and advice on how to deal with unaffordable debts, click the button below and fill in our contact form. One of our advisors will then contact you to discuss your options.

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