The proposals would see the total amount of debt permissible to enter a DRO increase from 20,000 to 30,000. The value of assets owned by individuals accessing a DRO would increase from 1,000 to 2,000, and the level of surplus income from 50 to 100 per month.
DROs were introduced in 2009 as low-cost and accessible debt solutions to support vulnerable people. They protect debtors from creditor action and after 12 months all debt within the order is written off.
The consultation follows an announcement last year that the government would be introducing a breathing space scheme in 2021, to provide people in debt with a 60-day pause on creditor enforcement action while they access professional debt advice.
Financial services expert Jonathan …
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