Do I qualify for a Debt Relief Order?

Pat Hutchinson MBE.
Pat Hutchinson MBE.

Q I am living at home with my parents and I have just lost my job. I have £13,000 debt and I have heard there is something called Debt Relief Orders. Do I qualify for help, I have nowhere else to turn.

A. A debt relief order (DRO) is one way to deal with your debts if you meet the criteria.

You may be able to get a Debt Relief Order (DRO) if all of the following things apply to you:

l you’re unable to pay your debts

l your debts are worth up to £15,000

l you’ve got £50 or less left over each month after you’ve paid your usual household expenses

l you don’t own your home

l savings or things of value you own, called assets, are worth less than £300. Some assets are ignored when working out the value

l you don’t own a car worth £1000 or more, unless it’s one that’s been specially adapted because you have a disability

l you haven’t had a DRO in the last six years and aren’t going through another formal insolvency procedure, such as bankruptcy or an individual voluntary arrangement (IVA)

l you’ve lived, had a property, or worked in the UK in the last three years

Debts that can go into a DRO are called qualifying debts. They include:

l credit cards, overdrafts and loans

l arrears with rent, utility bills, telephone bills, council tax and income tax

l benefits overpayments

l hire purchase or conditional sale agreements

l buy now - pay later agreements

l business debts.

To apply for a DRO:

l there’s a fee of £90. If you can’t afford to pay the fee you may be able to get help towards the cost from some charities

l you have to go to a DRO adviser, also called an approved intermediary - you can’t submit your own application. You can find a DRO adviser at most local Citizens Advice Offices.

While a DRO is in force:

l you don’t have to make payments towards most types of debt included in your DRO

l your creditors can’t force you to pay off the debts.

At the end of the 12 month DRO period, if your circumstances remain the same:

l your debts will be written off (unless excluded)

l you’re still responsible for paying off any that aren’t included in the DRO - this is because DROs don’t cover all debts.

In October 2015 potential changes are to raise the debt amount limit to £20,000 and worth of assets increased to £1,000.

If you’re unsure about whether a DRO is right for you, including whether you’re eligible, speak to a DRO adviser. You can find a DRO adviser at most Citizens Advice Offices.

Get free, confidential and independent advice from your nearest Citizens Advice at or for further information go to