If you have decided that a Debt Relief Order (DRO) is the right solution for you it is not possible to put one in place yourself. It is a formal legally binding agreement with your creditors and as such there are a number of steps that you will need to follow.
Wilmott Turner does not currently offer a service to help you implement a DRO. We can advise you as to whether it is the right debt solution for you. However if you do want to go ahead with your application you should follow the steps outlined below.
In order to apply for a Debt Relief Order you will need to work with an authorised debt counsellor. You can make contact either through your local Citizens Advice Bureau (CAB) or the the Step Change Charity.
Note: Most people contact Step Change to help them with implementing a DRO. The staff at Step Change are generally very helpful. However it is likely that they will first try to encourage you to start a DMP (Debt Management Plan). You such decline this offer and insist that you have decided that a DRO is the right solution for you.
The authorised debt counsellor will review your individual circumstances and ensure that you meet the Debt Relief Order criteria. They will then complete the necessary application form on your behalf and send it to the official receiver for processing.
Before they complete your documentation the debt counsellor will need to discuss the following information with you about your financial circumstances:
In order to be eligible for a DRO your unsecured debts must total no more than £20,000. The debt counsellor will want to make sure that this is the case.
Your income and living expenses
The debt counsellor must ensure that your disposable income is no more than £50 a month. To calculate this they will deduct your reasonable monthly living expenses from your monthly income.
Note: You should calculate your disposable income yourself before speaking to a debt councillor so that you know your disposable income is less than £50.
Your assets must not be worth more than £1000 to be eligible for a DRO. However you will be allowed to keep all of your reasonable household items, your car as long as it is worth less than £1000 and your pension. The debt counsellor will want to ask you about all of these things.
Once your application form has been completed by the authorised debt counsellor you will receive a copy of the document in the post to check through. If there are any errors you should ask your debt counsellor to change these.
Then before your application can be submitted you will need to pay a £90 application fee. You will normally be asked to pay this at the post office.
Once you confirm that the payment has been made your debt counsellor will submit your application to the Official Receiver (OR) on your behalf.
Once it is submitted the Official Receiver will review your DRO application. If they are satisfied that you meet the criteria for a DRO they will authorise the Order (in other word make it legally binding on your creditors). You name and personal details will then be recorded in the Insolvency Register.
Once your Debt Relief Order (DRO) is in place you can stop paying all of your creditors. The official receiver will inform all of them on your behalf.
From this point your creditors are no longer able to chase you for the repayment of your debt or add further interest or charges to the outstanding balances.
If there are any changes to your circumstances during your DRO you must inform the Official Receiver immediately.
Your Debt Relief Order will last for 1 year. At the end of this time as long as non of your circumstances have changed for the better you will be discharged and the debt you owed will written off leaving you debt free.