No Repayments - 100% Debt Write-Off
A DRO clears all included debts
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What is a Debt Relief Order?
A Debt Relief Order (DRO) is a way to deal with your debts if you don’t own your home, don’t have much spare income and your debts are no more than £20,000.
Your financial situation is assessed by an advisor.
Your debts must total less than £20,000 and your assets must not exceed £1,000 in value.
Some debts and assets are excluded and so don’t count towards this limit.
A DRO can help put a stressful situation behind you while you look forward to a more stable financial future.
Being in a Debt Relief Order
When the DRO is accepted you enter the 'DRO period' which lasts 12 months.
During this time you don't make any repayments and those you owe cannot take any action to recover any included debts.
DROs can be cancelled if finances improve during the DRO period
While you have a DRO you still have to pay certain excluded debts such as child support arrears, student loans and court fines.
When DRO period completes all debts are written off.
Applying For A DRO
The Insolvency Service is the Government agency responsible for overseeing insolvency in the UK.
Applying for your a Debt Relief Order is through them which requires a fee of £90, whether the application is accepted or not.
How We Can Help
We can determine if a Debt Relief Order or another solution is most suited to your situation. If a Debt Relief Order is appropriate, we will refer you accordingly.
Available in England and Wales only.
Which Debts Are Covered?
Most debts are written off by a Debt Relief Order.
Loans & Overdrafts
Store & Credit cards
Benefits over payments
HMRC & Council tax arrears
Debts with a Court Judgement
Rent, Gas and Electricity arrears
Catalogues & Buy now – pay later agreements
For other debts contact Debt Guardians for clarification
Certain debts cannot be included in a Debt Relief Order DRO such as; criminal court fines; debts obtained by fraud; child support arrears and most student loans.
There are no payments to make into the DRO nor towards your debts; nor any fees.
100% of debt is written off
When the DRO period completes all included debts are legally written off.
A sense of control
A DRO allows you to regain control of your money as you look towards debt freedom
Creditors they cannot pursue you for their debt or take legal action during the DRO nor once it completes..
Knowing when you'll be debt free
Provided you continue to meet DRO criteria for 12 month - you be debt free.
Impact on credit rating
Your participation in a DRO is recorded on your credit report which affects your ability to get credit in the medium to long term.
All adverse information is retained by credit reference agencies for 6 years.
Changes in your circumstances
If your circumstances change during the DRO period, you have a legal obligation to inform the Insolvency Service.
If you no longer meet the criteria for a DRO, it can be cancelled and you'll have to deal with your debts in another way. You will remain liable for the debts in full until the DRO successfully completes.
A DRO will be recorded and entered onto a public register but someone would need to be specifically looking for you on it to find you.
It is removed 3 months after the DRO ends.
Once you have applied for a DRO you must abide by the following restrictions. If you fail to do so, the DRO may be terminated and you will return to owing your debts in full.
You are not allowed to
- Attempt to take out £500 in credit without informing the credit provider of your DRO
- Be or act as the director of a company
- Create, manage or promote a company without the court’s permission
- Manage a business without telling those you do business with about your DRO
- Open a bank account without telling the bank or building society about your DRO.
The DRO restrictions usually last 12 months. They can be extended if reckless or dishonest behaviour caused or contributed to the extent of your debt problems.
Not all debts qualify
Debts that can go into a DRO are called qualifying debts. They include:
- Credit cards, overdrafts and loans.
- Arrears with rent, utility bills, telephone bills, council tax and income tax.
- Benefits over-payments.
- Hire purchase or conditional sale agreements.
- Buy now - pay later agreements.
- Business debts.
Debts that can’t go in a DRO include:
- Any debts obtained by fraud.
- Magistrates court fines and confiscation orders.
- Child support and maintenance
- Student loans
- Social fund loans
- Compensation for death and injury.
- These debts do not count towards the limit.
If you’re unsure whether a debt would be covered by a DRO, contact us.
Not available for homeowners
This is because DROs were created to be a lower cost and more simple alternative to bankruptcy - where no assets need to be considered.