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A debt relief order (DRO) is a way for you to have your debts written off if you do not own your home, have few assets and little available income to pay your creditors. If your DRO application is successful, most creditors cannot take action to recover your debts for 12 months. Debts are then written off after the 12 months.
You can only apply for a DRO through an ‘approved intermediary’.
The approved intermediary will make a DRO application to the official receiver’s office through a special on-line system. There is no court hearing.
To qualify for a DRO you must:
You can include most types of debt in your application as long as your total debts are less than the £20,000 limit.
Debts you can include:
You cannot include the following debts in a DRO:
You will need to make sure you pay ongoing payments on debts not included in the DRO.
The fee for a DRO is £90. There is no reduction if you are on benefits or a low income but you are allowed to pay in instalments. If you cannot pay the fee, you might be able to apply to a charity for help. The IMA have published a list of charities that can help with DRO fees.
If your DRO application is approved certain restrictions will be placed on you for 12 months from when the DRO is approved. The DRO will be recorded on your credit reference file and the DRO will be recorded on a public register called the ‘Individual Insolvency Register’. Credit reference agencies keep information on DRO’s for six years.
You can find a debt advice provider to help you with a DRO application on DebtHelpCompare.com