A debt relief order is an alternative to bankruptcy that you can apply for if you are unable to pay off your debts. The order is granted by the Insolvency Service if you meet the criteria, namely a low income and less than £15,000 of debt. A debt relief order lasts for less time than bankruptcy status, typically a year, and at the end of this period, you will be free of all debts that have been listed within the order. The debt relief order costs £90 to apply for, but you are able to set up a 6-month payment plan if you are unable to pay the full cost upfront. An authorised debt relief advisor needs to apply for the order on your behalf, and so your first step is to contact an advisor who can tell you whether you are eligible.
You cannot apply for a debt relief order if you have valuable assets that you can sell to raise funds towards the repayment of your debt. This includes possessions with a value of £300 or more, or savings totaling at least this amount, a car worth £1000 or more or a private pension fund worth over £300. You also need to have less than £15,000 of debt. Any more than this, and you will need to look into an Individual Voluntary Agreement (IVA) as an alternative. For full details of the criteria for applying for a debt relief order, we would recommend speaking to a qualified debt adviser. By filling out our short form, you can request a confidential call from a debt professional who will be able to talk you through your options.
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