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Debt Relief Orders (DRO)

Debt relief orders (DRO) are a way of having your debts completely written off, providing you owe under £20,000, don’t own a home and have little income left after covering your costs of living. If you want to find out whether a DRO is right for you, please request a callback and we will set you up with an expert advisor.

How would a DRO plan affect me?

A DRO can freeze debt repayments and interest for around 12 months. During this time, you won’t have to make payments to your creditors for any debts included under the DRO, and your creditors enforce your debts.

After your DRO’s term is complete, your debts will be written off. Any debts that were not covered by the DRO will remain in place.

To apply for a DRO, you should get in touch with a Debt Advisory service who will help you decide if a DRO is right debt solution for you. To get started with your DRO application, you will be sent all the necessary forms to fill out by an approved intermediary.

Once completed you will have to send your forms back to your approved intermediary along with the £90 application fee. This fee can be paid in instalments. When the fee has been paid your application will be submitted.

The debts that qualify for DROs are:

  • Council tax and rent arrears,
  • Overdue utility and telephone bills,
  • Benefits overpayments,
  • Business debts,
  • Income tax
  • Buy now - pay later schemes.

There are also certain restrictions in place while your DRO is in place. The restrictions are:

  • You cannot create, manage or promote a limited company, or act as a company’s director, without explicit permission from a court.
  • You cannot borrow more than £500 without informing the creditor about your DRO.
  • Your details will be listed on the Individual Insolvency Register.

What are the advantages of a DRO?

  • You do not have to make any payments towards debts covered by your DRO during its term.
  • Any debts that remain at the end of your DRO may be written off.
  • Once your DRO is in place, your creditors cannot pursue you for your debts during its term.
  • You do not need to appear in court to apply for a DRO.
  • When the DRO ends, your remaining debt will be written off.

What are the disadvantages of a DRO?

  • DROs are only available for debts under £20,000 or £15,000 in Northern Ireland.
  • You will have to pay a one-off fee of £90.
  • You cannot apply for a DRO if you are a homeowner.
  • Your details will be listed on the Individual Insolvency Register.

Who is eligible for a DRO?

DROs are designed for those who have little income and few assets. To be eligible for a DRO, you must:

  • If you are living in England or Wales, owe less than £20,000, own under £1,000 in assets and a car worth no more than £1,000.
  • If you are living in Northern Ireland, owe less than £15,000, own under £300 in assets and a car worth no more than £1,000.
  • Have less than £50 in surplus monthly income.