The psychological effects of debt aren't just felt by those who hold the debt, they're often also felt by those...
Debt Relief Orders Turn 10 Years Old
Back in 2009, a new means of debt relief was introduced to help individuals who were struggling under the burden of unmanageable debt and personal insolvency, but whose means, debts and assets were relatively low.
What Are Debt Relief Orders?
Personal insolvency is a situation where an individual is unable to pay their debts when they fall due. Prior to the introduction ot DRO’s, Individual Voluntary Arrangements (IVA’s) or Bankruptcy were typical solutions for those with unmanageable debt. Debt Relief Orders were introduced as a cheaper and more straightforward option which was most suitable for debtors with low incomes, less than £20,000 of personal debt who did not own their own homes or have any high value assets.
Debt Relief Orders allow those who qualify, to write off their debt after 12 months in a way that’s reminiscent of bankruptcy, but the process is easier, cheaper and less formal.
A Decade of Debt Relief Order Statistics
Figures recently released by The Insolvency Service reveal the scale to which Debt Relief Orders have impacted the lives of those who’ve been helped over the last decade;
- 254,000 people have made use of Debt Relief Orders since they were introduced.
- Those making use of DRO’s were dealing with an average debt of £9,400
- The total value of the relief provided over the last 10 years amounts to £2.3 Billion.
- From introduction to 2017, 32,045 people in the Northwest made use of Debt Relief Orders. More than any other region.
- Over 75% of the debt written off by DRO’s was held by the 25 to 54 years age group.
- 36% Of DRO’s were issued to Men vs. 64% Women
- At £312 Million, DRO’s provided more debt relied in 2018 than in any other year thus far.
Where can I get a Debt Relief Order?
Applying for a debt relief order is relatively simple, you’ll have to find out if you qualify, but from there it’s a case of filliong out a form and paying a fee to the Insolvency Service, currently set at £90.00 and if accepted, you’ll have a 12 month period in which you don’t need to pay anything towards your debts. If your situation doesn’t improve, those debts will be written off. Despite bing a formal debt solution, you won’t need to appear in court, but creditors are still prevented from chasing you while the DRO is in force, providing you with a financial breathing space. Because the process is a formal one however, details of your debts will appear on the publicly accessible Insolvency Register.
If you need advice on this or on any other personal insolvency solutions, we offer a free consultation to go through the available options and help you pick the best debt solution for you in your personal circumstances. Contact us today and let us point you in the right direction.