Understanding Debt Relief Orders

  Debt Relief Orders or “DRO”sare forms of insolvency in which the borrowers are able to resolve their debt much quicker through the use of the courts system and without any personal appearance at those courts required. 

Debt Relief Orders should be applied for online thorough the use of apre-approved intermediary provided by the official Debt Counseling services. 

Upon receivingyour application and upon you paying the fee, from that point on an Official Receiver (OR) will then be able to make your order, and will be able to do so even without involving the courts, as long as the applicantsare eligible. 

Those requirements include:

• Debtors being unable to pay their debts;

• Debtors total unsecured liabilities are not allowed to exceed £15,000 and their total assets (gross)are not allowed to exceed £300;

• Debtors disposable incomes, after the deduction of regular household expenses, are not allowed to exceed £50 every month.

• Debtors are not allowed to be domiciled in Wales or England or in the last three years have themselves been resident or been carrying out business in Wales or England.

• Debtors are not allowed to have previously been the subject of a DRO within the last six years.

• Debtors are not allowed to be involved in other formal insolvency procedures at the same time as an application for any DRO.

If they are qualified, any Official Receivers will have to communicate to all of your lenders and be advising them that they are not able to take any special action in order to recover any money from you without the court’s permission; you are therefore not permitted to be making any particular payments towards your debts and in turnyou should be freed or discharged from your debts upon the time arriving that the DRO ends – normally after a period of twelve months. 

That said, a DRO canthen be cancelled or amended should your financial situation get better.