Debt Relief Orders (DRO)

If you aren’t keen on taking the Bankruptcy route, and if your circumstances allow it, then Debt Relief Orders can also prove to be a low cost alternative to bankruptcy.

But what exactly are Debt Relief Orders? And how can they help you?

Debt Relief Orders (DRO) – The Facts

  1. Debt Relief Orders (DROs) came into force in England and Wales on 6th April 2005.
  2. They cost £90 and are a low cost alternative to Bankruptcy.
  3. DROs are administered by the Official Receiver and are available to debtors who:
  • Owe less than £15,000 in total.
  • Have assets worth no more than £300 (although a debtor may have one vehicle worth no more than £1,000).
  • Have less than £50 a month of disposable income i.e after settling their living costs.

DROs are not available to individuals who have an interest in a property (even if it is in negative equity).

  • A debtor can only apply for a DRO through an approved intermediary.
  • The Citizens Advice Bureau will put debtors in touch with an approved intermediary in their local area.
  • Once a DRO is made the debtor’s debs are frozen for twelve months.
  • During this time creditors cannot pursue the debtor nor can they add interest or charges to the debt.
  • If, after 12 months, the debtor’s circumstances have not changed, then the debts are written off.

Download further information here Debt Relief Orders