Debt Relief Order

A Debt Relief Order (DRO) are a formal insolvency process that can help you deal with your debts if you owe less than £20,000, don’t own your home and have little spare income.

DROs are an alternative debt solution to bankruptcy and usually last one year (12 months). Once you are in a DRO creditors are unable to recover their money without permission from the courts.

Once discharged from your DRO, all of the debts listed in your DRO will be cleared.


Disadvantages of a DRO

  • DROs will stay on public record for 15 months and on your credit record for six years
  • You will have to pay a one-off fee when applying for a DRO
  • You may have difficulty opening a bank account once you have a DRO
  • You’ll be expected to pay back creditors if your financial situation improves
  • You can’t get credit over £500 without telling the lender you have a DRO

Advantages of a DRO

  • DROs usually last one year (12 months)
  • At the end of your DRO your debts will be written off
  • DROs are a low cost alternative to bankruptcy
  • Your creditors can’t take any action over the money you owe


Is a DRO right for me?

  • You are unable to pay the debts your owe
  • You owe less than £20,000
  • You have £50 or less spare income each month (after normal household expenses)
  • You are not a homeowner
  • You have less than £1,000 worth of assets (this excludes a car which you also own, as long as its value is less than £1,000)
  • You have not had a DRO in the past six years and are not in another formal insolvency procedure
  • You have lived or worked in England for the past three years

How do I apply for a DRO?

An application must be made to the Official Receiver’s office through an authorised intermediary. The Official Receiver’s fee is £90. Intermediaries are not allowed to charge you a fee for submitting your DRO application to the Insolvency Service.


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Debt Relief Order

Updated on 2016-10-02T00:09:28+00:00, by Kristian Stock.