Debt problems? Find out whether you might qualify for a DRO

A Debt Relief Order, or DRO, gives debt relief to people in England and Wales who aren’t carrying too much debt, have little or no disposable income and have no real assets to use to repay their debts – and who can’t afford to go bankrupt.

If you’re in debt and struggling, a Debt Relief Order is one of the debt relief options that might be available to you. It is a form of insolvency that can help people who are really struggling financially because of debt. It might be the right option for your debt problems if the following apply to you:

 

• You can’t repay your debts.
• You owe £15,000 or less (not including student loan, court fines, child support, etc.)
• You have gross assets worth £300 or less.
• You have only £50, or less, ‘spare’ cash every month once you’ve paid national insurance and all of your essential household expenses.
• You are an English or Welsh resident, or, you have lived here, or carried out business here, during the last three years.
• You have not had another DRO in the last six years.
• You are not going through insolvency already.
• You have not sold a property, or given it away, for less than it’s worth in the last two years (if you have, your application may be rejected by the official receiver).
• You have not given preferential treatment to any of your lenders in the last two years.

 

How to get a DRO

The Insolvency Service says that if you’re considering a Debt Relief Order, you should seek financial advice from an Approved Intermediary, a solicitor, a qualified accountant or a debt counsellor. You can only apply for a DRO through an Approved Intermediary and you will have to pay a fee of £90 on application.

A Debt Relief Order is a form of insolvency and it would be visible on your credit record for six years – it’s difficult to borrow money while it’s on there.

If you do qualify for a DRO, or would like to find out whether you do, seek the advice of an Approved Intermediary, or other appropriate person, before you make any firm decisions.