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Debt Relief Orders – the dos and donts

Before you apply for a debt relief order and during the debt relief order, there are certain things you must not do. These include:

  • hiding, destroying or faking any information, books or documents up to one year before you apply for a DRO and during the length of the DRO
  • failing to tell the Official Receiver of any change in your circumstances that would affect your application for a DRO between applying and the order being granted
  • giving away or selling things of value for less than they are really worth to help you qualify for a DRO.

It is an offence to do any of these things and, if found guilty, the Official Receiver may refuse to grant you a debt relief order.  In more serious cases, you could be prosecuted and fined, sent to prison or both. If you have already been granted a debt relief order, the Official Receiver might apply for a Debt Relief Restriction Order, or take your DRO away.

(If you didn’t intend to defraud anyone or hide information, you will not be found guilty of an offence.)

Also, for the period of the debt relief order, you cannot:

  • get credit over for over £500 without telling the lender you have a debt relief order
  • carry on a business under a different name from the one on which you were granted a debt relief order, without telling everyone involved with your business the name under which you were granted your debt relief order
  • be involved with promoting, managing or setting up a limited company, without getting permission from court.  You also cannot act as a company director without getting permission from court.

If you do not comply with the conditions of the debt relief order, or the Official Receiver believes you have provided wrong information or been dishonest, they can apply for a Debt Relief Restriction Order. If you are given Debt Relief Restriction Order, it means the restrictions on the things that you can do remain in place from two to fifteen years.

(This will not affect your debt relief order which will still end after twelve months and the debts included in the order will still be written off).

However, if you fail to follow the restrictions, you will be committing an offence.  This could lead to a fine or imprisonment.

If you have any queries about things you must not do before and during a debt relief order, ask your authorised debt adviser.

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