How to get a Debt Relief Order
A Debt Relief Order (DRO) is a way of dealing with your debts if you can’t afford to pay them. It means you don’t have to pay certain kinds of debt for a specified period (usually 12 months).
At the end of the DRO period, the debts included in it will be written off (‘discharged’) and you won’t have to pay them.
If you obtained any of your debts through fraud, you will have to restart paying them when the DRO has ended.
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 £20,000 or less
- you have less than £50 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 £1000 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.
This guide provides general information only and is not a substitute for professional legal or financial advice.
Every effort has been made to ensure the information is accurate, but it should not be relied on as a full authoritative statement of the law. The Insolvency Service cannot accept any responsibility for any errors or omissions as result of negligence or otherwise.
Published: 28 August 2015
Updated: 1 October 2015
- Increase of debt threshold from £15,000 to £20,000. Maximum assets increase from £300 to £1000
- Added that debts obtained by fraud will not be discharged at the end of the DRO.
- First published.
From: The Insolvency Service