Debt Relief Order: Write Off Debts Under £30,000
A Debt Relief Order could write off all your debts in just 12 months. If you have little income, few assets, and owe less than £30,000, a DRO could be your fresh start.
What is a Debt Relief Order?
A Debt Relief Order is an official way to deal with debts you cannot afford to pay. It is designed for people with low income, few assets, and debts under £30,000.
Protection from creditors
Once your DRO is approved, creditors cannot contact you or take any action to recover debts included in the Debt Relief Order.
12 month moratorium
Your debts are frozen for 12 months. No payments needed during this time while your DRO is active.
Fresh start after DRO
After 12 months, if your situation has not improved, your debts are written off completely through the Debt Relief Order.
Do You Qualify for a Debt Relief Order?
To get a Debt Relief Order, you need to meet all of the DRO eligibility requirements. If you are not sure, we can help you check.
Not sure if you qualify for a DRO?
The DRO eligibility rules can seem complicated, but do not worry. Our team can look at your situation and tell you whether a Debt Relief Order is right for you, or if another solution might work better.
If you do not meet the DRO eligibility criteria, we can help you explore other options like an IVA, Debt Management Plan, or bankruptcy.
What Debts Can Be Included in a DRO?
Most unsecured debts can be included in a Debt Relief Order, but some types of debt cannot be written off through a DRO.
DRO debts included
- Credit cards and store cards
- Personal loans and payday loans
- Overdrafts
- Catalogue debts
- Some benefit overpayments
- Money owed to friends or family
Debts not included in DRO
- Student loans
- Child maintenance
- Court fines
- Social fund loans
- TV licence arrears
- Debts from fraud
How Does a Debt Relief Order Work?
Getting a Debt Relief Order is straightforward. Here is how to apply for a DRO.
Free DRO assessment
We check if you meet the DRO eligibility criteria and gather information about your debts.
DRO application
An approved DRO intermediary submits your application to the Insolvency Service.
Moratorium begins
Your debts are frozen for 12 months. Creditors cannot chase you for payment during this time.
Debt free
After 12 months, your debts are written off completely through your Debt Relief Order.
DRO Pros and Cons
A Debt Relief Order is not right for everyone. Here are the main advantages and disadvantages of a DRO.
DRO Advantages
- Only £90 DRO cost to apply
- Debts written off after 12 months
- No payments to make during the DRO
- Creditors cannot take action against you
- Simpler than bankruptcy
DRO Disadvantages
- Stays on credit file for 6 years
- Strict DRO eligibility requirements
- Cannot own your home
- Some debts cannot be included
- Cancelled if circumstances improve significantly
DRO vs Bankruptcy: Which is Better?
If you do not qualify for a Debt Relief Order, or it is not the right solution for you, there are other ways to deal with your debts.
Individual Voluntary Arrangement
Pay what you can afford for 5 years, then remaining debt is written off. Good if you have regular income but cannot pay debts in full.
Bankruptcy
For larger debts or when other solutions are not suitable. Costs £680 compared to £90 DRO cost, but has fewer restrictions. Important comparison for DRO vs bankruptcy.
Debt Relief Order Questions Answered
Find answers to frequently asked questions about Debt Relief Orders and DRO eligibility.
Our advisors can explain everything about Debt Relief Orders in plain English and help you decide if a DRO is right for you.
Get Free DRO AdviceWhat is a Debt Relief Order?
A Debt Relief Order (DRO) is a way to deal with your debts if you owe less than £30,000, have very little spare income (less than £75 a month), and do not own your home. It freezes your debts for 12 months, and if your situation has not improved, the debts are written off completely.
How much does a DRO cost?
The DRO cost is £90. This is paid to the Insolvency Service when you apply. If you cannot afford to pay this upfront, some charities and debt advice organisations can help spread the cost or may be able to help you find funding for your DRO application.
Will a DRO affect my credit score?
Yes, a Debt Relief Order stays on your credit file for 6 years. During this time, it may be harder to get credit, a bank account, or even some jobs. However, for many people, their credit score was already affected by missed payments, so a DRO gives them a fresh start.
Can I keep my car with a DRO?
You can keep a vehicle worth up to £2,000 if you need it for work, getting to medical appointments, or caring for someone. This is part of the DRO eligibility criteria. If your car is worth more than this, you may need to consider other debt solutions.
What debts cannot be included in a DRO?
Some debts cannot be included in a Debt Relief Order, such as student loans, child maintenance, court fines, and social fund loans. You will still need to pay these. Most other debts like credit cards, overdrafts, and personal loans can be included in your DRO.
What happens if my circumstances change during the DRO?
If you get a new job, inherit money, or your income increases significantly during the 12 months, you must tell the Official Receiver. Your DRO may be cancelled, and you would need to find another way to deal with your debts.
Can I apply for a DRO myself?
You cannot apply for a Debt Relief Order directly. You need to go through an approved DRO intermediary, which is usually a free debt advice service. They will help you fill in the paperwork and check you meet all the DRO eligibility requirements before submitting your application.
How is a DRO different from bankruptcy?
A DRO is simpler and cheaper than bankruptcy. The DRO cost is £90 compared to £680 for bankruptcy. However, Debt Relief Orders have stricter limits on how much you can owe and what assets you can have. If you owe more than £30,000 or have significant assets, bankruptcy might be more suitable. This is an important factor when comparing DRO vs bankruptcy.
Compare Your Debt Solution Options
IVA vs DRO
Compare Debt Relief Orders with IVAs to see which solution is right for you.
Individual Voluntary Arrangement
Discover if an IVA could be better if you have debts over £30,000 or regular income.
Bankruptcy
Understand how bankruptcy compares to a DRO and which might be more suitable.
Debt Management Plan
Learn about DMPs as an alternative if you don't qualify for a DRO.
Low Income Debt Help
Specific debt solutions and help available if you're on a low income.
Benefits Debt Help
Get advice on managing debt while receiving benefits and what protections you have.
Could a DRO Give You a Fresh Start?
If you are struggling with debts under £30,000, a Debt Relief Order could write them off in just 12 months. Find out if you qualify with our free, no obligation assessment.
Check if you qualify for a DROQuick 2 minute check. 100% free and confidential.