What are the Advantages of a Debt Relief Order?
The term of a Debt Relief Order is one year. After the Debt Relief Order is completed, your debts are eliminated and you're on the road to financial recovery.
- Your debts will be written off after 1 year.
- Your creditors cannot take further action against you without permission from the Court.
- The £90 fee is less than the cost of petitioning for bankruptcy.
Not everyone can apply for a Debt Relief Order. You are only eligible if, after paying your expenses, have £50 or less a month left over.
What are the Disadvantages of a Debt Relief Order?
- You will not be able to get a Debt Relief Order if you have assets worth £300 or more.
- If you've entered into a conditional agreement for the purchase of something, you may be compelled to return the item for credit.
- You will be unable to obtain credit lines over £500 without first informing the lender that you have a Debt Relief Order.
- The Debt Relief Order will stay on your credit record for 6 years.
- If you are a homeowner, you are ineligible.
- Because Debt Relief Orders appear on your credit report, your employment may also be affected.
- Student loans and certain fines cannot be discharged through a Debt Relief Order.
- Banks may refuse to open an account in your name if you have a Debt Relief Order.