Debt Relief Order Guide

Information to be taken into account before deciding upon a Debt Relief Order

DRO Benefits

Once your Debt Relief Order has been accepted, you will benefit from:

No repayments

There are no payments to make into the DRO nor towards your debts; nor any fees.

100% of debt is written off

When the DRO period completes all included debts are legally written off.

A sense of control

A DRO allows you to regain control of your money as you look towards debt freedom

Legal protection

Creditors they cannot pursue you for their debt or take legal action during the DRO nor once it completes..

Knowing when you’ll be debt free

Provided you continue to meet DRO criteria for 12 month – you be debt free.

DRO Considerations

As with any insolvency process there are consequences of entering into an Debt Relief Order. These include

Impact on credit rating

Your participation in a DRO is recorded on your credit report which affects your ability to get credit in the medium to long term.

All adverse information is retained by credit reference agencies for 6 years.

Changes in your circumstances

If your circumstances change during the DRO period, you have a legal obligation to inform the Insolvency Service.

If you no longer meet the criteria for a DRO, it can be cancelled and you’ll have to deal with your debts in another way. You will remain liable for the debts in full until the DRO successfully completes.

Not private

A DRO will be recorded and entered onto a public register but someone would need to be specifically looking for you on it to find you.

It is removed 3 months after the DRO ends.

Personal restrictions

You must follow conditions apply while you are in the 12 month DRO period. Should be break them them your DRO may be terminated and you’ll return to owing your debts in full.

You are not allowed to

  • Attempt to take out £500 in credit without informing the credit provider of your DRO
  • Be or act as the director of a company
  • Create, manage or promote a company without the court’s permission
  • Manage a business without telling those you do business with about your DRO
  • Open a bank account without telling the bank or building society about your DRO.
The DRO restrictions usually last 12 months. They can be extended if reckless or dishonest behaviour caused or contributed to the extent of your debt problems.

Not all debts qualify

Debts that can go into a DRO are called qualifying debts. They include:

  • Credit cards, overdrafts and loans.
  • Arrears with rent, utility bills, telephone bills, council tax and income tax.
  • Benefits over-payments.
  • Hire purchase or conditional sale agreements.
  • Buy now – pay later agreements.
  • Business debts.

Debts that can’t go in a DRO include:

  • Any debts obtained by fraud.
  • Magistrates court fines and confiscation orders.
  • Child support and maintenance
  • Student loans
  • Social fund loans
  • Compensation for death and injury.
  • These debts don’t count towards the limit.
If you’re unsure whether a debt would be covered by a DRO, contact us.

Not available for homeowners

This is because DRO were created to be a lower cost and more simple alternative to bankruptcy – where no assets need to be considered.

Quick DRO Eligibility Check