Debt Relief Order . Finance Tips Surviving the Credit Crunch, Top Tips for surviving the credit crunch

  Debt Relief Order (DRO)


Since April 2016 Debt Relief Orders have been available to people on low incomes who find they are struggling with unsecured Debt’s of £15,000.00 or less and have assets with a value of no more than £300.00.

Here we will outline the most frequent questions and provide names of companies who may be able to help you with a Debt Relief Order (DRO).

What are the requirements for a debt relief order?

The requirements for DROs are as follows:

  • You are unable to pay your debts;

  • Your total unsecured liabilities must not exceed £15,000;

  • Your total gross assets must not exceed £300;

  • Your disposable income, following deduction of normal household expenses, must not exceed £50 per month.

  • You must be domiciled in England or Wales, or in the last 3 years have been resident or carrying on business in England or Wales.

  • You must not have previously been subject to a DRO within the last 6 years. 

  • You must not be involved in another formal insolvency procedure at the time of application for a DRO, such as:

a) An undischarged bankrupt;
b) A current Individual Voluntary Arrangement;
c) A current Bankruptcy Restrictions Order or Undertaking;
d) A current Debt Relief Restrictions Order or Undertaking;
e) An interim order
f) A current pending debtor’s bankruptcy petition in relation to the debtor but the debtor has not been referred to the DRO procedure by the court as a more suitable method of debt relief;
g) A current pending creditor’s bankruptcy petition against the debtor but the debtor has not obtained the creditor’s permission for entry into the DRO process.

How will a DRO be made?

DROs are applied for online, with an approved intermediary helping to complete an application.
Upon receipt of the application and payment of the fee, an official receiver is able to make the order, administratively, without the involvement of the court if it appears that the applicant meets the requirements.
The official receiver is able to refuse to make an order or can choose to delay the decision pending further information from the applicant.

What are the effects of a DRO?

During the period that an order is in force, you will:

  • Be protected from enforcement action by the creditors included in the application (bar certain creditors whose debts cannot be scheduled in the DRO and those creditors whose debts are included in the DRO but who have successfully obtained leave from the court to pursue their debts).

  • Be free from those debts at the end of the period (normally 12 months from the order).

  • Be obliged to provide information to and co-operate with the official receiver.

  • Be expected to make arrangements to repay their creditors should their financial circumstances improve.

As with other forms of personal insolvency, a DRO debtor’s credit rating will be affected and there will be civil and criminal penalties for those who abuse the system.

The official receiver is able to investigate, either on his own account or as the result of an objection from creditors, and is able to revoke the order if the debtor is found to have failed to provide a full and accurate account of their financial affairs (for example, an understatement in their assets or income). Failure to provide such an account may result in civil and criminal sanctions.

What restrictions will be placed upon a person who has a DRO?

 For the duration of the order, the debtor will be subject to similar restrictions as in bankruptcy, and their details will be on the publically available Individual Insolvency Register (available at

These restrictions include the following:

  • You must not obtain credit of £500 or more, either alone or jointly with another person, without disclosing that they are subject to a DRO to the lender.

  • You may not carry on a business (directly or indirectly) in a name that is different from the name under which they were granted a DRO, without telling all those with whom the debtor does business the name under which they were granted a DRO.

  • You may not be involved (directly or indirectly) with the promotion, management or formation of a limited company, and may not act as a company director, without the court’s permission.

  • You will only be able to obtain a DRO once every six years. 

Furthermore the official receiver will be able to apply for a Debt Relief Restrictions Order, similar to the bankruptcy restriction order, which will extend the period of restriction for up to fifteen years for debtors who are dishonest or culpable.

How can I get a DRO?

By seeking financial advice from a debt advisor and if a DRO appears to be appropriate, an approved intermediary will be able to help you complete the online application. The intermediary may be the same person from whom advice was originally sought, or may be a further advisor that you are referred to once it is considered that a DRO is appropriate.
You cannot apply for a DRO without the assistance of an intermediary.
To apply for a DRO involves payment of a fee which will be less than £100 usually £90.00.
Companies Known to Surviving The Credit Crunch which we are happy to recommends are:

Baines and Ernst
Debt Free Direct
Gregory Pennington