What is a Debt Relief Order?
A Debt Relief Order (DRO) is a formal insolvency solution available in England and Wales for people on a low income who have few assets and a lower level of debt. In general terms, it places a 12-month freeze on the debts it covers, during which no payments are made towards them. If your circumstances have not improved by the end of that period, the debts covered may be written off.
DROs have strict qualifying conditions set in law, covering how much you owe, what you own, and how much money you have left each month. You cannot apply directly yourself: an application is prepared with an approved intermediary — a debt adviser authorised to submit DRO applications — and is then submitted to the Official Receiver, who decides whether to make the order. There is no fee to apply.
A DRO is a formal insolvency and carries lasting consequences. It appears on the public Insolvency Register, affects your credit file for six years, and brings restrictions during the 12-month period, including on obtaining further credit. Not all debts can be included.