In a positive move from The Insolvency Service a small scale debt fix has now been rolled out.

A Debt Relief Order (DRO) is intended to provide debt relief to people in England and Wales who owe relatively little money, who have negligible disposable income and no assets to repay creditors.

The DRO has also been introduced to enable those who are unable to afford the costs of Bankruptcy. To qualify for a DRO you need to meet the following criteria;

• You are unable to pay your debts.
• You owe up to a maximum of £15,000.
• Your total gross assets must not exceed £300.
• After taking away tax, national insurance contributions and normal household expenses, your disposable income must not exceed £50 a month.
• Your place of domicile (the country legally recognised as your personal home) must be in England or Wales, or at any time in the last 3 years you must have been resident or carrying on business in England or Wales.
• You must not have been subject ti a previous DRO wihtin the last six years.
• You must not be involved in any other formal insolvency procedure at the time you must apply for a DRO, such as
  • an undishcharged bankruptcy order;
  • a current IVA (Individual Voluntary Arrangement);
  • a current bankruptcy restriction order (BRO) or banking restriction undertaking;
  • a current debt relief restriction order or undertaking (DRRO or DRRU);
  • an interim order.

If you are currently petitioning for bankruptcy (asking a court to make you bankrupt) and the court has not referred you to the DRO procedure, then you wont be allowed to apply for a DRO at the same time.

If a creditor is currently petitioning for your bankruptcy (asking a court to make you bankrupt), then you must get the creditors permission before applying for a DRO.

If you have given away any property or sold it for less than its true value in the last two years, the official receiver may not approve your application.

If you have preferred any creditors over others in your payments within the last 2 years, the official receiver may not approve your application.

The fee when applying for a debt relief order is currently £90 and must be paid in cash, unless a charity has agreed to pay your fee, in which case payment can be made by cheque.

A debt relief order can be applied for online via an approved intermediary, details available at the insolvency service;

http://www.insolvency.gov.uk/insolvencyprofessionandlegislation/DebtRelief.htm

Trumpo thinks that this is a positive step in the right direction for the most finanically vulnerable.

Keep smiling..

Trumpo

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