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Debt Relief ORder

What is a Debt relief Order?

A Debt Relief Order or DRO is a new form of 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; designed for people who have few or no assets (less than £1,000) and little disposable income (less than £50).

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 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.

  • You are unable to pay your debts (classed as insolvent).
  • Your Debts do not exceed £20,000.
  • Your assets must not exceed £1,000. Vehicles are negotiable providing it is not of higher value than £1,000.
  • Your disposable income must not exceed £50 per month. (Disposable income is the amount left over each month after all living expenses have been paid.
  • You must not have been involved in a Debt Relief Order 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...
    • 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 £1,000) and a vehicle (not exceeding (£1,000)
  • 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. The 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.

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