A DRO represents a sort of bankruptcy-lite with many of the same restrictions but with only a £90 fee payable to the Insolvency Service as opposed to a fee of £510 in bankruptcy.
Baines & Ernst, part of Paymex Group, has been approved to authorise brokers acting in DRO applications. No approved authorities can charge consumers for providing DRO application support.
While qualification for a DRO depends on the ability of the individual to make the £90 payment to the Insolvency Service, the system is designed to be more accessible to those facing extreme hardship than existing avenues such as bankruptcy and Individual Voluntary Arrangements.
All DRO applications must be submitted online and verified by a broker at Baines & Ernst. Once DROs are in force debtors are protected against any enforcement actions proposed by creditors included under the terms of the orders.
Under normal circumstances they will be released from debt after 12 months.
But debtors will be expected to cooperate with receivers while DROs remain in force and take steps to repay their creditors should their financial position change for the better.