All About Debt Relief Orders

It is incredibly easy to get lost in a world of debt at the moment but not through spending more than you can afford (although that is of course how you get into it in the first place). Instead, getting lost is easy as a direct result of the amount of jargon that is bandied about in relation to debt management options. It is no wonder that many people give up trying to make sense of it on their own or choose the wrong option. Take “debt relief orders” for example. Do you know what they are and what they can offer you in terms of a solution? If you do not then you are not on your own but you will need to read on to find out more.
First of all, what is a debt relief order? Well, debt relief orders are designed to help out those individuals that can no longer afford to pay off their debts in England and Wales but is not the same as declaring yourself bankrupt. Instead, it is an order that is granted by the Insolvency Service to protect you from your creditors for a year. During that period of time, none of your creditors are able to take action to get their money back. Furthermore, when the debt relief order expires, you are relieved of all those debts that have been listed in it.
There are strict criteria that anyone applying for debt relief orders has to fulfil though. For example, your debts cannot exceed £15,000 and you must have a low income with no more than £50 spare when all bills have been paid every month. In addition, if you have savings or possessions that are worth more than £300, own a car or other vehicle that is worth more than £1000, or have a private pension with more than £300 in it then you do not qualify for debt relief orders. Finally, if you already have an IVA or are bankrupt then you will not qualify. In short, they really are designed to help those people that are desperate and have effectively become swamped with debt that they have no way of paying off.
Debt relief orders actually cover most debts at the moment. “Qualifying debts”, as they are commonly known, include credit cards, loans, overdrafts, rent, utilities, council tax, benefit overpayments, hire purchase loans, conditional sale agreements, social fund loans and even buy now pay later deals.
That is not to say that you can keep the goods that you get on buy now pay later and hire purchase deals. Depending on how long you have had them for and how much you have already paid off the debt, you may have to give them back before you are granted debt relief orders. In addition, any fines that you have related to criminal activity, such as court fines, and any student loans that you have in place cannot be included in the orders. Child support and maintenance is also exempt.
So how can you go about getting debt relief orders and relieve the stress associated with paying off your debts? Well, you do need to have your application approved by an authorised advisor. He or she will review your application and check your financials to make sure that you qualify for a debt relief order and will also submit the application for you. It does cost a small fee of £90 but this does not necessarily have to be paid in full upfront. Instead, you can pay it over a period of six months. As such, if you believe that you will qualify for debt relief orders and can use the help then this is certainly one of the debt solution options for you to consider! Why let the jargon stop you when you can relieve the stress of being in debt quickly and easily with debt relief orders?

Andy Gorton is the author and editor of the Bankruptcy Clinic

Andy Gorton – who has written posts on Bankruptcy Clinic Blog.

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