If you have more debt than you can afford to pay off, a possible debt solution is a Debt Relief Order (DRO). This allows you to freeze payments of debt included in the DRO for 12 months. After this time, if your financial situation hasn’t improved, eligible debts will be written off. This guide will go through the DRO application process, providing helpful tips and highlighting common mistakes to avoid.   

Steps to Apply for a DRO

The steps involved in applying for a DRO are as follows:

1. Find a DRO adviser

It’s not possible to apply for a DRO on your own – you’ll need a specialist DRO adviser known as an ‘approved intermediary’ to complete the application for you. Therefore, the first step is to find an adviser, who will then determine your eligibility and fill out the necessary forms. 

2. Your DRO adviser checks your eligibility

Before you apply for a Debt Relief Order, your debt adviser will ensure you meet the eligibility criteria by calculating your total debts and asking you about your financial history. To be eligible for a DRO:

• You must be a resident of England, Wales or Northern Ireland
• Your qualifying debts can’t exceed £50,000
• You can’t have more than £75 in disposable income every month
• Your assets can’t be worth more than £2,000
• Your vehicle can’t be worth more than £4,000. 

3. Your DRO adviser fills out the application

You’ll need to work with your DRO adviser to fill out the DRO application form, which includes details of your income, expenses, debts and assets. Once you’ve checked all the information in the application is correct, your adviser will submit it to an Official Receiver at the Insolvency Service.

4. The Official Receiver (OR) makes a decision

The OR will review your Debt Relief Order application and they will either make the DRO, defer it if they need more information before approving or refuse it if you’re not eligible. If your application is successful, the OR will: 

• Give you confirmation that your DRO has been approved
• Explain the rules and restrictions
• Inform the creditors listed in your DRO
• Add your DRO to the Insolvency Register.

Information You’ll Need to Provide

When your DRO adviser fills out your application, you’ll need to give them the following information: 

• Personal details including your name, address and contact details
• Your National Insurance number
• Details of any current or past debt solutions you’ve had
• Details of your household’s income including salaries, benefits and pensions 
• Proof of income, spending and debts, such as pay slips, credit card statements, benefits letters and utility bills
• How much you contribute to household living costs
• Details of your creditors and any debts you owe them
• Your current employment status 
• Details of any assets you have.

How Long Does the Application Process Take?

The length of the application process can vary but it typically takes between four and five weeks. Once your DRO adviser submits your application to the Insolvency Service, they should make their decision within 10 working days. If you’re based in Northern Ireland, it may take a few weeks. If your application is approved, you’ll enter the moratorium period, which lasts 12 months. 

Common Mistakes to Avoid When Applying

It’s important that your DRO application is accurate. Here are some common mistakes to look out for: 

• Providing inaccurate information

Giving incomplete or inaccurate information is one of the most common mistakes applicants make. To prevent this, double-check that all details about your income, outgoings, debts and assets are correct. Mistakes or omissions can lead to your application being rejected or problems later on.

• Not including all debts

It’s crucial to include all of your eligible debts in the application. If you leave any out, those debts will not be covered by the DRO, and creditors may still pursue you for repayment. 

• Failing to disclose all streams of income

Your income doesn’t only refer to your salary but every stream of income you receive, whether that’s your pension, benefits or pay from a side-hustle – a job or paid activity to support your main income. All of this must be disclosed so your application can be completed accurately. 

• Applying when you don’t qualify

Ensure that you meet all the eligibility criteria for a DRO before applying. If you don’t, your application will be rejected.

• Not working with an approved DRO adviser

Your debt adviser must be on the Government’s list of approved debt advisers. 

Where to Get Help With Your Application

As mentioned above, to apply for a DRO, you’ll need support from an approved DRO adviser, which includes our debt experts here at MoneyPlus. You can get in touch with us for further information about making a DRO application.

Alternatively, you can get free debt advice from organisations such as MoneyHelper, Citizens Advice and StepChange.