The debt relief order was introduced in 2009 in the UK as a form of insolvency or bankruptcy for people in debt, with low income and few assets.

What Is The Purpose?

The debt relief order or DRO is a simplified alternative to the traditional bankruptcy in the UK. Its role is to help people discharge their debts more quickly and with lower costs.

In order to benefit from a DRO, one has to have small liabilities, little extra income, no or few assets and to be unable to pay his debts in a reasonable timeframe; homeowners are not eligible.

Filing for bankruptcy is a time-consuming process for the debtor; using a DRO instead means that the authorities or approved organisations can use the Internet to file the documentation, making the process faster and easier. The debtor does not even have to make a personal appearance at court.

When Would You Get One?
In order to be eligible for a DRO, one has to meet the following conditions:
• Being unable to pay the debt
• Liabilities under £15,000
• Total assets under £300
• Disposable income under £50 after deduction and necessary expenses
• Legally living in England or Wales or being a resident of at least 3 years
• Not beneficiated from a DRO in the last 6 years
• Not be involved in a formal insolvency procedure
• Not be a part of an undervalued transaction in the last 2 years
• No preferences given to any person in the last 2 years

After the debt order is approved, all the debts that have been included in it will be written-off and one will not have to pay them anymore. However, other remaining debts will have to be paid by the individual. A person can only apply for a debt relief order once every 6 years.