Debt Relief ORder (DRO)

What is a Debt relief ORder?

A Debt Relief Order or DRO is a debt solution that allows you to have your unaffordable debts written off up, providing you owe less than £30,000 (£20,000 in NI) with only a few assets totalling no more than £2,000 (£1,000 in NI) and also a car valued at no more than £2,000 (£1,000 in NI).

If a Debt Relief Order is considered suitable, you will be referred to an approved intermediary*. They will check that your situation fulfils the Debt Relief Order criteria and will help you complete the online form. They will submit it on your behalf to a government official called the official receiver. The official receiver then makes the order, if appropriate.

*An approved intermediary is someone who has been approved by a competent authority chosen by the government.

The criteria for a Debt Relief Order

In England & Wales

• Your debts must not exceed £30,000;
• Your assets must not exceed £2,000 (certain assets do not count, for example clothing, furniture and a vehicle worth less than £2,000); and
• Your surplus income must not exceed £75 a month after paying your essential personal and household spending.

In Northern Ireland

• Your debts must not exceed £20,000;
• Your assets must not exceed £1,000 (certain assets do not count, for example clothing, furniture and a vehicle worth less than £1,000); and
• Your surplus income must not exceed £50 a month after paying your essential personal and household spending.

A Debt Relief Order will last for 1 year, and once it has ended you are released from your debts (with certain exceptions).

Debt Relief ORder Advantages

• Your debts will be written off at the end of the Debt Relief Order. There are a few exceptions, as explained in the disadvantages below.
• None of the creditors listed in the Debt Relief Order application can take further action against you without the court’s permission.
• It allows you to make a fresh start after
  1 year.
• The fee (£90) is affordable and can be paid in instalments but the fee must be paid before the application can be made.
• You will keep your assets and a vehicle as detailed above.
• The approved intermediary ensures that you are given appropriate advice and that you fit the criteria for a Debt Relief Order.

Debt Relief Order Disadvantages