How a Debt Relief Order works

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Writes off the debt you can’t afford

A Debt Relief Order works by suspending your unmanageable unsecured debts – ensuring you can afford your other living costs – and then writes them off after a year if your circumstances haven’t improved enough.

Costs less than bankruptcy

Have you considered bankruptcy, but can’t afford the fees (up to £700)? If so, a DRO could help. All it costs is a one-off application fee of £90, which can be paid in instalments if necessary.

No need to attend court

Most debt companies can help you apply for a Debt Relief Order – there’s no need to go to court. Simply call them today or fill in the call-back form on their homepage and they will get in touch to let you know whether a DRO is right for you. If it isn’t, they’ll help you find another way to tackle your debts that better suits your circumstances.

Debt Relief Order

Who qualifies for a DRO?

A Debt Relief Order is only available to people who need it. There are several criteria you must meet to qualify, including:

  • You must have unaffordable unsecured debts of no more than £15,000
  • Your available income (after essential living costs) must not exceed £50 a month
  • The total value of your assets must not exceed £300 (with the exception of a car, which can be worth up to £1,000)
  • You must have lived or conducted business in England, Wales or Northern Ireland in the last three years
  • You must not have been subject to a Debt Relief Order in the last six years
  • You must not be involved in any other insolvency proceedings (such as an IVA).

You will have to meet all the above criteria to qualify. If you don’t, there is still help available – just call them and talk to their partners. They could help you find the right solution for you.

Things to remember

Although a Debt Relief Order could make a big difference to your finances, it has its disadvantages like any other debt solution.

In particular, there will be a big impact on your credit rating. Records remain on your credit history for six years, and you’ll probably find it very difficult to borrow any more money during this time and possibly beyond.

But if you’ve really been struggling and there really is no other way for you to clear your debts, the benefits should outweigh the drawbacks.