Debt Relief Orders (DROs) are one way to deal with your debts if you owe less than £30,000, do not have much spare income and do not own your home.

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If you get one:

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• Your creditors cannot recover their money without the court’s permission​

• You’ are usually freed (‘discharged’) from your debts after 12 months

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Get a Debt Relief Order

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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.

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Costs

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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.

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Eligibility

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You’re generally eligible if you meet all of these criteria:

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• You owe less than £30,000​

• You have less than £75 a month spare income​

• You have less than £2,000 worth of assets​

• You do not own a vehicle worth £2,000 or more​

• You have lived or worked in England and Wales within the last 3 years​

• You have not applied for a DRO within the last 6 years

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Restrictions

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You must follow rules called ‘restrictions’ if you get a DRO.

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This means you cannot:

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• Borrow more than £500 without telling the lender about your DRO​

• 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

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If you want to open a bank account, you may also have to tell the bank or building society about your DRO.

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Check the Individual Insolvency Register to see when the restrictions end.

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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.

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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 do not agree.

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What you need to know

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While you have a DRO you still have to pay:

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• Your rent and bills​

• Certain debts, for example student loans, court fines

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DROs can be cancelled if:

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• Your finances dramatically improve​

• You do not co-operate with the official receiver - for example you do not give them the information they ask for

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If you get new debt after your DRO is approved you could:

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• Get a bankruptcy order​

• Be prosecuted if you do not tell new creditors about your DRO

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Your DRO is added to the Individual Insolvency Register - it’s removed 3 months after the DRO ends.

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Your DRO will stay on your credit record for 6 years.