DRO (Debt Relief Order)

A Debt Relief Order (DRO) is a form of insolvency solution and is aimed at people with little disposable income and very little in the way of assets.

A Debt Relief Order lasts for 12 months and creditors included in the DRO cannot take further action during this time. If after 12 months your circumstances have not improved then the debt gets written off and you will be debt free.

The application fee for a Debt Relief Order is £90.

To be eligible for a Debt Relief Order you must owe less than £30,000, not own a vehicle over the value of £2000, not have assets or savings over the value of £2000 and a disposable income of less than £75 after paying tax, national insurance and normal household expenses.

If your circumstances change so that you are able to pay some or all of your debts, your DRO may be revoked so you can arrange to pay your creditors (the people or companies you owe money to).

To be eligible for a DRO, you must meet these criteria:

  • you owe £30,000 or less
  • you have less than £75 to spend each month, after paying tax, national insurance and normal household expenses
  • you’ve lived or worked in England or Wales in the last 3 years
  • your assets aren’t worth more than £2000 in total
  • you’ve not had a DRO in the last 6 years

You won’t be eligible if you are involved in bankruptcy proceedings or any other formal insolvency procedure. However, if one of your creditors has asked a court to make you bankrupt, you may ask the creditor for permission to apply for a DRO instead

The Differences between Debt Relief Orders and Debt Management can be seen Here.

This solution can carry a lot of the same stipulations as bankruptcy. Please ensure you seek the appropriate advice before considering this solution.

A Debt Relief Order will have a serious impact on your credit rating and although Debt Relief Order is normally discharged after a year it will be evident on your credit file for 6 years.

For further information:

Citizens Advice Bureau


National Debtline