How long does a debt relief order last?

If debt repayments have become too much, a debt relief order is a solution if you do not own your home and you meet the other eligibility requirements. Although a debt relief order will stay on your credit file for six years from when it is approved, it is still considered a viable solution to clearing debts and making a fresh start.

A debt relief order normally lasts for 12 months. However, it will impact your credit report for six years from the date it was approved as it will be listed for future lenders to see.

After the initial 12-month period – known as a moratorium – you are normally discharged, which means you are no longer bound by the rules and restrictions placed upon you during this period, and that your debts have been cleared.

These rules and restrictions are similar to those which would be put in place if you went bankrupt.

Notification of a debt relief order ending

You will not be notified when your debt relief order has ended. You can find this out though by checking the insolvency register and searching your name and address.

Here you can also print off a copy of your listing on the insolvency register as evidence your debt relief order has ended, which is often asked for by creditors. This will prove when the 12-month period ended.

It’s worth noting that you only have three months to print off a copy of this once the debt relief order has ended, because after this time it will be taken off the register.

What to do if a creditor chases you for payment after the debt relief order has ended

In rare cases, some people have experienced a creditor trying to collect a debt that was listed in their debt relief order after the moratorium period has ended. If this happens to you, then do not pay.

To prevent them from contacting you further, it’s a good idea to send creditors a copy of the print out from the insolvency register, with the date your debt relief order ended.

If it is too late to get a copy, you can ask them to get in touch with the insolvency service’s debt relief order team, who can directly confirm the debt relief order has ended and they have no claim to any debts you once owed.

What can you do once your debt relief order is finished?

Once your moratorium period is over you can start to look into rebuilding your credit rating again, which will have been significantly impacted by the debt solution.

You will find it hard to obtain any large amounts of credit – such as a mortgage – but starting small is always the best way forward in this case.

Low-interest credit cards or overdrafts are good options for using credit to prove you can responsibly manage your money. Only take on what you know you can afford to pay back and use this sparingly.

However, it’s worth noting that if a creditor asks, you will need to tell them that you have had a debt relief order.

If you are considering applying for a debt relief order or are in your moratorium period and want to know more about what happens once it is over, get in touch with a member of the PayPlan team today on 0800 316 1833, for free advice.