Debt Relief Order
A DRO can be a good option for someone who owes less than £20,000, has little or no spare income and does not own their own home. You can receive a DRO from an official of the bankruptcy court but you must apply through a debt advisor and it will cost £90, the official receiver’s fee.
The advantages of a DRO are that your creditors cannot recover their money without the court’s permission and you are usually free from your debts after 12 months.
There are restrictions that come with a DRO that can affect your employment and credit; for example you cannot:
- Borrow more than £500 without telling the lender about your DRO
- Act as the director of a company
- Create, manage or promote a company without the court’s permission
- Manage a business without telling those you do business with about your DRO
- These restrictions usually last 12 months and your DRO will appear on your credit record for six years