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Debt Relief Orders (DRO’s) were introduced by the Government in 2007.  The Government’s intention was to provide a simple way of enabling people who had relatively low debts and low incomes and also very little by way of assets to clear their debts and have a fresh start without having to choose bankruptcy.

DROs can only be made with the assistance of an approved ‘intermediary’ who must be either a solicitor, a qualified accountant, a reputable financial adviser or an authorised debt advice centre.

Do I qualify for a DRO?

In summary for you to qualify for a DRO you must meet all of the following conditions:

  • You are unable to pay your debts
  • You owe up to a maximum of £20,000
  • Your assets are not more than £1,000
  • Your monthly disposable income after normal household expenses is less than £50
  • You live in England or Wales

There are some additional qualifying conditions.  For further information please see “Guide to Debt Relief Orders” (hyperlink).

What does a DRO do?

The DRO stops your creditors from taking any action against you for 12 months.  If your financial position improves in this time you may be expected to recommence payments of your debts.  If your financial position does not change at the end of the period of 12 months the debts will be discharged and your creditors will not be able to claim any more money from you.

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