Debt Relief Order


A cost-effective remedy to deal with debts under £30,000 and very little surplus income.

What is a Debt Relief Order – DRO?

A Debt Relief Order is an official order granted by the official receiver that if approved will freeze your debts, interest and creditor recovery procedures for a period of 12 months. If after 12 months your situation has not changed then any unsecured debts will be written off.

Is a DRO suitable for me?

If you have unsecured debts which total less than £30,000, the value of your assets and savings is less than £2,000, your car is worth less than £2,000 (unless it’s been specially adapted because you have a disability) and your monthly disposable income after you have paid all of your creditors and household bills is below £75,  then a Debt Relief order could be a solution to tackle your debts. 

A period of 12 months will be granted during which all debt payments and interests are frozen by your creditors, if after 12 months your situation has not changed then your unsecured debts will be written off. Debts covered by a Debt Relief Order generally include credit cards, overdrafts, loans, store and catalogue cards, rent, council tax, utility, phone bills, Revenue debts including overpaid benefits, self assessment tax, VAT and PAYE/NIC.

There are other solutions including IVA’s, Debt Management Plans, Bankruptcy and Dealing Directly with your Creditors which may be appropriate. If you live in Scotland, the solutions are different, please visit Scottish Debt Solutions.

For full debt advice and whether a DRO would be your best option, you can also speak to one of our advisors.

What does the service cost and who can I speak to?

A fee of £90.00 which is paid to the insolvency service. You can apply for a DRO through an approved intermediary. There is a list of approved intermediaries listed on the Insolvency Service website.

The Debt Advisor Ltd is regulated by The Financial Conduct Authority. This means we are able to offer debt advice and deliver both formal and informal solutions. DRO’s do need to be carefully considered and you must take independent debt advice. We hope that the information and debt advice on this site including Frequently Asked Questions, will help inform you.

DRO – The benefits and the risks

  • A Debt Relief Order is designed to be a low cost debt solution and an alternative to Bankruptcy if you have a debt level of £30,000 or less, little or no savings and few assets as detailed above.
  • Although a Debt Relief Order is a formal solution the cost is relatively low and the outcome is that for a period of 12 months you will have your debts and interest incurred frozen and if your situation has not changed after 12 months your debts will be written off.
  • If you qualify for a DRO, you can potentially write off up to £30,000 of unsecured debt.
  • Lenders are not allowed to contact or chase you for payment and you do not need to make any payments to lenders for 12 months.
  • Not all debts qualify to be written off under a DRO. Debts such as student loans, child support maintenance and magistrates courts fines are ineligible under the scheme.
  • If you have given away assets, sold goods for less than their value or paid certain creditors in favour of others in the 2 years prior to your DRO application, a DRO could be refused.
  • A Debt Relief order will appear on your credit file and you will find it difficult to obtain credit for a period of 6 years. In addition, your details will be added to the insolvency register

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The DRO Process

Opting for a Debt Relief Order needs careful consideration. The decision should only be taken after you have taken independent advice from an FCA regulated practice.  Your affairs will be investigated and if your behaviour prior to the DRO is found to be dishonest (gifting away assets, or being dishonest) you could face a Debt Relief Restrictions Order.