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Debt Relief Order (DRO)

Will a DRO be suitable for me?

Debt Relief Orders involve a partnership between The Insolvency Service and the professional debt advice sector. Advisers from the debt advice sector act as ‘approved intermediaries’ and will help you apply to The Insolvency Service for a DRO. Atlantic works with an 'approved intermediary' who can apply with you or on your behalf using an online application form. The Official Receiver (not a court) will then consider your application. We do not charge any fees for provision of any debt advice prior to deciding to refer you to an 'approved intermediary' and no referral fees.

Your home must be in England or Wales, or at any time in the last 3 years you must have been resident or carrying on business in England or Wales. There were 25,717 individual insolvencies in England and Wales in the second quarter of 2013 of which 7,132 were Debt Relief Orders (DROs). This figure is down 10.4% on the corresponding quarter of 2012.

A DRO is a serious matter, like any insolvency proceeding, and to apply you must meet certain strict conditions:

  • You must be unable to pay your debts
  • You must owe less than £20,000 to your unsecured creditors
  • You can own a car to the value of £1,000 but the total value of other assets must not exceed £300
  • After taking away tax, national insurance contributions and normal household expenses, your disposable income must be no more than £50 a month
  • You must be living in England or Wales, or at some time in the last 3 years have been living or carrying on business in England or Wales
  • You must not have been subject to another DRO within the last 6 years
  • You must not be involved in another formal insolvency procedure at the time you apply

The Insolvency Service recommends in their Guide to Debt Relief Orders (PDF) that you seek debt advice to consider all the alternatives. Some debts are excluded from a DRO (e.g. Student Loans, Court Fines, Child Maintenance).

A fee is payable to The Insolvency Service on applying for a DRO. The fee is currently £90, but may change in future. Once paid, the fee is non-refundable, whether the Official Receiver approves or declines your application. So it is very important to make sure that what you put on the application form is accurate and complete before it is submitted.

If your DRO application is approved, you must:

  • Comply with the Official Receiver’s request to give further information about your financial affairs. You should co-operate fully if they ask you for more information
  • Inform the Official Receiver of any assets you obtain or increases in your income whilst subject to a DRO, including lump-sum cash payments, windfalls, property and money left to you in a will
  • Not obtain credit of £500 or more from anyone without first telling them that a DRO has been made against you
  • Not make payments direct to creditors included in the DRO

Atlantic is able to assist you in obtaining a bank account if you are subject to a DRO.

Please speak to one of Atlantic’s experienced debt advisers to determine the most appropriate debt solution to your circumstances or complete the contact form.