Debt Relief Orders - Information for debtors

If you think you cannot pay your debts and are considering a debt relief order (DRO) this page will give you some information on:

• whether you meet the requirements for a DRO;
• how much it will cost;
• how to get advice and find an approved intermediary;
• how to apply for a DRO;
• what will happen after you apply for a DRO;
• the effect of a DRO upon you and your creditors;
• further information.

For more detailed information on DROs please see our booklet ‘Guide to Debt Relief Orders’.

While DROs are aimed at providing a cheap and accessible form of debt relief, they should not be seen as an easy option for resolving your debt problems.

Do you meet the requirements for a DRO?

To meet the requirements for a DRO:

• You must be unable to pay your debts.
• Your total debts must not be more than £15,000.  This does not include unliquidated debts (debts where the amount due is not yet known) or debts that cannot be included in a BRO.
• Your total assets must not be more than £300.
• Your disposable income after deducting all normal living expenses, must not be more than £50 per month.
• You must be living in England or Wales, or at any time during the last 3 years have been resident or carrying on business in England or Wales.
• You must not have been subject to a DRO within the last 6 years. 
• You must not be involved in any other formal insolvency procedure at the time of application for a DRO.
• If you have presented a petition for your own bankruptcy and are awaiting a hearing date, you must have been referred to the DRO procedure by the court.
• If you have been notified that a creditor has presented a bankruptcy petition against you, then you must get that creditor’s permission to apply for a DRO.

How much will it cost?

The current fee for a DRO is £90.  It must be paid to the official receiver, in full, before your application will be considered.

How to get advice and find an approved intermediary

You can only apply for a DRO through a skilled debt adviser - an ‘approved intermediary’ - who is approved to give advice on DROs by one of the competent authorities.  The intermediary will decide whether a DRO is the best kind of debt relief for you.

To find details of the competent authorities please click here.

How to apply

The intermediary may complete the form with you, or they may set up the application and let you fill in the form yourself.

You should make sure the information on your application is correct and up to date at the time of submission. If not, your application may be rejected, any DRO may be cancelled and further action may be taken against you.

Please note there are some debts that cannot be included in a DRO. For further details see our booklet ‘Guide to Debt Relief Orders’.

What happens after you apply for a DRO?

The intermediary will submit your application electronically and print out a copy for you to sign.  When you have paid the full fee the application can be sent to the official receiver, either by you or the intermediary.

The official receiver will look at your application and either accept it, reject it, or decide to seek further information.

The effect of a DRO on you and your creditors

If your application is accepted the official receiver will:

• send you notice of the making of the DRO and details of the duties imposed on you while the DRO is in force;
• send notice of the DRO to each of the creditors owed a debt covered by the DRO;
• make an entry on the Electronic Individual Insolvency Register (EIIR) showing your details and the fact that a DRO has been made against you.

Moratorium period

The DRO will place a moratorium period upon the debts included in it. Creditors who are owed debts listed in the DRO cannot take any action for repayment of their debts during this moratorium without the permission of the court. Once this period has ended the debts listed in the DRO will be discharged and you will be free from those debts.

During the period of the DRO you must carry on paying ongoing commitments, such as rent and utility bills.  You will be responsible for any debts that you incur after a DRO has been approved but must not make any payments to any creditor who is included in the DRO.

Restrictions and duties placed on a debtor subject to a DRO:

You have a duty to inform the official receiver of any change of address and any change in circumstances.  You must give the official receiver any information they ask for.

You will be subject to the same restrictions as bankrupts.

Further Information

If you need more information about a prospective or current DRO application, you should consult an authorised intermediary.

You may also contact:

The Insolvency Service Enquiry line:

Tele: 0845 602 9848 (9am – 5pm, Monday – Friday)

Email: insolvency.enquiryline@insolvency.gsi.gov.uk

Other Insolvency Service Publications:

http://www.insolvency.gov.uk/guidanceleaflets/Guides.htm