A debt relief order is a recognised alternative to bankruptcy
A Debt Relief Order is designed for those who cannot keep up with their existing debt repayments and will not be able to repay their debts over a reasonable amount of time. Debt Relief Orders are only for those with serious debt problems and a very low income and level of assets.
To be considered for a Debt Relief Order, you cannot be a homeowner, you must owe less than £15,000 in unsecured debt, have no more than £300 worth of assets and must have less than £50 a month income left over each after all of your living costs and essential expenditure have been made.
When a Debt Relief Order is applied for, the application will be processed by a trusted intermediary body, who will prepare and scrutinise each case to ensure it meets the necessary criteria. If your application is successful, it will then be submitted to the Official Receiver, who will grant the Debt Relief Order, waiving all expensive court fees that bankruptcy has.
The Debt Relief Order will work by freezing your debts for a period of 12 months, throughout the 12 month period, your creditors will agree not to pursue you for the outstanding debt, nor add further interest on to the balance. If, after the 12 months have passed, you are still unable to pay back your debts at a reasonable amount each month, they will be written off.
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