Debt Relief Orders (DROs) are one way to deal with your debts if you owe less than £20,000, don’t have much spare income and don’t own your home.
If you get one:
You get a DRO from the official receiver, an officer of the bankruptcy court, but you must apply through an authorised debt adviser. They’ll help you fill in the paperwork.
There’s a list of organisations that can help you find an authorised debt adviser in the guide to DROs.
The Money Advice Service has information about where to get free debt advice.
The official receiver’s fee is £90. Your debt adviser can tell you how and when to pay it. In some cases a charity may be able to help you with the cost – ask your debt adviser.
You’re generally eligible if you meet all of these criteria:
You must follow rules called ‘restrictions’ if you get a DRO.
This means you can’t:
If you want to open a bank account, you may also have to tell the bank or building society about your DRO.
Check the Individual Insolvency Register to see when the restrictions end.
The restrictions usually last 12 months. They can be extended if careless or dishonest behaviour caused your debt problem. For example, you lied to get credit.
The official receiver will tell you if they should be extended. To extend them, you’ll be asked to agree to a ‘Debt Relief Restrictions Undertaking’. The court can issue a ‘Debt Relief Restrictions Order’ if you don’t agree.
While you have a DRO you still have to pay:
DROs can be cancelled if:
If you get new debt after your DRO is approved you could:
Your DRO is added to the Individual Insolvency Register – it’s removed 3 months after the DRO ends.
Your DRO will stay on your credit record for 6 years.