Debt Advice Online are happy to inform you about a brand new way to clear your debts called Debt Relief Orders or DRO's
At the moment the procedures and legislation are being finalised so the details below may be subject to change.
Firstly, we are anticipating that Debt Relief Orders will become available in April 2009.
A Debt Relief Order (DRO) would be suitable for people with relatively low amounts of debt and who are currently unable to access other forms of Debt Help.
You can get a DRO by contacting us using the Enquiry button below. One of our advisors will be able to tell you if it would be appropriate to your situation, and if so we will also help you complete an application.
The requirements for a DRO have not yet been finalised but we anticipate that the following will apply:
- The applicant is unable to pay their debts;
- The applicant’s total unsecured debts must not exceed £15,000;
- The applicant’s total gross assets must not exceed £300;
- The applicant’s disposable income, following deduction of normal household expenses, must not exceed £50 per month.
- The applicant must be living in England or Wales, or in the last 3 years have been resident or carrying on business in England or Wales.
- The applicant must not have previously been subject to a DRO within the last 6 years.
- The applicant must not be involved in another formal insolvency procedure at the time of application for a DRO, such as:
- An undischarged bankrupt
- A current Individual Voluntary Arrangement
- A current Bankruptcy Restrictions Order or Undertaking
- A current Debt Relief Restrictions Order or Undertaking
- An interim order
- If there is a current pending applicant’s bankruptcy petition in relation to the applicant but the applicant has not been referred to the DRO procedure by the court as a more suitable method of debt relief
- If there is a current pending creditor’s bankruptcy petition against the applicant but the applicant has not obtained the creditor’s permission for entry into the DRO process.
For the duration of the Order, the applicant will be subject to similar restrictions as in bankruptcy, and their details will be on the publically available Individual Insolvency Register (available at www.insolvency.gov.uk)
These restrictions include the following:
The applicant 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.
The applicant 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 applicant does business the name under which they were granted a DRO.
The applicant 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.
The applicant may not hold certain public offices1, or hold offices as a trustee of a charity or a pension fund.
The applicant 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 applicants who are dishonest or culpable.
If you wish to find out more, please contact us and we will do our best to help you further.
