Debt Solutions
Debt relief orders image - woman on laptop

Debt Relief Order (DRO)

Debt Solutions

What is a Debt Relief Order (DRO)?

A debt relief order (DRO) is a way to have your debts written off if you have a relatively low level of debt and have few assets.

A DRO is only available to individuals who have very little disposable income available to pay to their creditors, have few or no assets, and have a limited level of debt.

You may be eligible for a Debt Relief Order if you owe less than £50,000 in total to your creditors, you have £75 or less left over each month after your essential bills and outgoings have been paid, your car (if you have one) is worth less than £4000 (£2000 in Northern Ireland) and your other assets don’t exceed a value of £2000.

A DRO will last for 1 year, and once your DRO has ended you are released from your debts (with certain exceptions). You won’t need to make any payments towards your debts and there is no fee to apply.

You can only make an application for a DRO via an Approved Intermediary.

Advantages of a debt relief order:

A DRO lasts for just 1 year and you won’t make any further payments to your debts

Your debts will be written off at the end

Creditors can’t take further action against you

Brunette woman sat on the floor with a laptop, pointing left

Disadvantages of a debt relief order:

Your DRO is entered on a public register

Your DRO will show on your credit file for 6 years

If your situation improves (e.g. your affordability increases and you’re able to pay more than £75 per month towards your debts) and you no longer meet the criteria, your DRO may be withdrawn

Some debts, like student loans, fines and social fund loans can’t be included

If you’re a regulated or licensed professional, or you work with money, your employment may be affected

You can’t act as a director of a company or be involved in its management unless the court agrees

You can’t take out credit of £500 or more without disclosing that you are subject to a DRO

You can’t have a DRO if you own your own home. Even if you have negative equity.

If you acquire any property during the year that the DRO is in force, your DRO could be revoked

You may have a debt relief restrictions order (the restrictions can be similar to those in force during the DRO) made against you for 2 to 15 years if you act irresponsibly, recklessly or dishonestly

Your DRO could be withdrawn if you don’t co-operate with the Official Receiver

You can’t have a DRO if you’ve had one in the last 6 years

DRO Frequently Asked Questions