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DRO

Debt Relief Order (DRO)

A Debt Relief Order (DRO) is a formal insolvency procedure for people with low income, limited assets, and unsecured debts. It provides legal protection from creditors for 12 months, after which qualifying debts are written off. Our advisers will assess whether a DRO is right for your circumstances and explain every option available to you.

Advantages and Disadvantages of a DRO

A DRO can be a genuine solution for those who qualify, but it is not right for everyone. Below is a balanced summary of the key points.

Potential advantages

  • No application fee — the previous £90 charge was abolished in April 2024
  • All qualifying debts written off after the 12-month moratorium
  • No monthly payments to included creditors during the moratorium
  • Interest and charges on included debts are frozen
  • Legal protection — creditors cannot take enforcement action during the moratorium
  • Administered through approved intermediaries (StepChange, National Debtline, Citizens Advice) at no cost

Potential disadvantages

  • Strict eligibility: debts must be £50,000 or under and disposable income under £75 per month
  • Not available to homeowners or those with a beneficial interest in property
  • Total assets must be £2,000 or less (vehicle up to £4,000 assessed separately)
  • Recorded on your credit file for 6 years from the date of the order
  • Your name appears on the Individual Insolvency Register for 15 months
  • Cannot borrow more than £500 without disclosing DRO status during the moratorium
  • Cannot act as a company director or manage a business without court permission
  • If your financial situation improves significantly, the DRO may be revoked
  • Certain debts are excluded: student loans, child maintenance, court fines

Whether this solution is right for you depends entirely on your individual circumstances. Our advisers will assess your situation and explain all available options before any recommendation is made.

Who May Be Eligible

To qualify for a DRO, you must meet all of the following conditions:

  • Unsecured debts of £50,000 or less
  • Disposable income of less than £75 per month after reasonable living costs
  • Total assets worth £2,000 or less (a vehicle worth up to £4,000 may be permitted separately)
  • You are not a homeowner and do not have a beneficial interest in land or property
  • You have not had a DRO in the past 6 years
  • You are not currently bankrupt or in an active IVA
  • You live in England, Wales, or Northern Ireland, or have done so within the last 3 years

Application Fee

There is no application fee for a DRO. The previous £90 administration fee was abolished in April 2024 by the Insolvency Service. A DRO is now entirely cost-free to apply for.

How a DRO Works

  • A DRO must be applied for through an approved intermediary — you cannot apply directly. Approved intermediaries include StepChange, National Debtline, and Citizens Advice.
  • Once granted, a 12-month moratorium begins. During this period, you make no payments to included creditors and creditors cannot take action against you.
  • Interest and charges on included debts are frozen for the moratorium period.
  • If your circumstances have not changed significantly after 12 months, all included debts are written off.
  • If your financial situation improves significantly during the 12 months (for example, your income increases or you receive a windfall), the Official Receiver may revoke the DRO.

What Is and Is Not Included

Most unsecured debts can be included: credit cards, personal loans, overdrafts, utility arrears, and benefit overpayments. The following are not included:

  • Student loans
  • Child maintenance arrears
  • Court fines
  • Social fund loans
  • Debts incurred through fraud

Is a DRO Right for You?

A DRO can be an appropriate solution if you have limited income, few assets, and relatively modest unsecured debts. It is not suitable for homeowners, those with higher income or assets, or those whose debts exceed £50,000. Our advisers will assess your full circumstances and explain all options — including Debt Management Plans, IVAs, Breathing Space, and bankruptcy — so you can make a fully informed decision.

Talk to one of our advisers

Complete the form below and one of our advisers will be in touch. There is no obligation and everything is treated in the strictest confidence.

Debt solutions may affect your credit rating and are not suitable in all circumstances. Your individual circumstances will be assessed before any recommendation is made. To find out more about managing your money and getting impartial debt advice, visit moneyhelper.org.uk. Help with Debt Ltd (FCA FRN: 1058208) is an Appointed Representative of Dee Valley Finance Limited (FRN: 811106), authorised and regulated by the Financial Conduct Authority.