Debt Relief Order (DRO)

What is a Debt Relief Order (DRO)?

It is an alternative to Bankruptcy, once made an individual creditor can not take out any legal action against you to recover the debt.

To apply for a Debt Relief Order you must do so through an intermediary.

Advantages

• Simple Process


• Debts Written off


• Process only lasts one year


• Cost is only £90

Disadvantages

• You must Qualify for a Debt Relief Order (DRO)


• Similar restrictions to Bankruptcy


• Can't be a home owner


• Disposable Income Restrictions

You can't apply for a debt relief order if you:

• own things of value or have savings of over £300


• own a vehicle worth more than £1,000


• have a private pension fund worth over £300.

You can only apply for a debt relief order if you meet certain conditions. These are when:

• you have qualifying debts of £15,000 or less. These debts must be of a certain type


• you have spare available income of £50 or less a month after paying your normal household expenses


• the things you own (your assets) and any savings are worth £300 or less. However, if you have a motor vehicle, this must be worth £1,000 or less unless it has been specially adapted because you have a physical disability


• in the last 3 years you must have lived, had a property or carried on a business in England or Wales.

Debt Relief Orders can only be completed by approved competant authorities. We can advise on who these are and which one to approach.