Debt Relief Orders (DRO) were introduced in 2009 as a way for individuals with relatively low levels of debt and minimal disposable income to obtain relief from their financial obligations DROs are intended to provide individuals with a fresh start by allowing them to be released from their debts after a period of one year, during which time creditors are prohibited from taking any further action to pursue the outstanding debt However, one area where individuals may still face significant challenges even after obtaining a DRO is in relation to rent arrears.
Rent arrears are a common issue faced by many individuals who are struggling financially Falling behind on rent payments can have serious consequences, including the risk of eviction and damage to an individual’s credit rating In some cases, individuals may find themselves in a situation where they are unable to make any headway in clearing their rent arrears, even after obtaining a DRO.
One of the key reasons why individuals may continue to struggle with rent arrears after obtaining a DRO is that DROs do not cover certain types of debt, including priority debts such as rent arrears This means that even though a DRO may provide relief from other debts, such as credit card bills or personal loans, individuals will still be responsible for repaying any rent arrears they may have accrued.
Another reason why individuals may have difficulty in addressing their rent arrears after obtaining a DRO is that the restrictions imposed by the DRO can make it challenging for them to increase their income or make arrangements to repay the arrears For example, individuals with a DRO are prohibited from borrowing more than £500 without informing the lender of their DRO status, which can make it difficult for them to access emergency funds to cover their rent arrears.
Additionally, individuals with a DRO are required to make monthly payments towards their debts for a period of one year While these payments are intended to help individuals take control of their finances and work towards becoming debt-free, they may not always be sufficient to cover ongoing rent arrears This can leave individuals in a difficult position, where they are unable to make progress in reducing their arrears and may face the threat of eviction.
Despite these challenges, there are steps that individuals with a DRO can take to address their rent arrears and avoid further financial difficulties dro and rent arrears. One option is to speak to their landlord or housing provider to explain their situation and explore the possibility of setting up a repayment plan for the arrears Many landlords are willing to work with tenants who are struggling financially and may be willing to negotiate a manageable repayment plan that takes into account the individual’s financial circumstances.
Individuals with a DRO can also seek advice and support from a debt advisor or a housing charity These organizations can provide individuals with information on their rights and responsibilities as tenants, as well as advice on how to manage their finances and prioritize their debts They can also help individuals explore options for increasing their income, such as accessing benefits or finding additional sources of income.
In some cases, individuals may also be eligible for financial assistance to help them address their rent arrears For example, individuals who are in receipt of certain benefits may be able to access Discretionary Housing Payments (DHP) to help cover their rent arrears DHPs are designed to provide individuals with temporary financial assistance to help them meet their housing costs, including rent arrears, and can be a valuable resource for individuals who are struggling to keep up with their rent payments.
Ultimately, while DROs can provide individuals with much-needed relief from their debts, they may not always address all of an individual’s financial challenges, particularly when it comes to rent arrears By seeking advice and support, exploring repayment options with their landlord, and accessing additional sources of financial assistance, individuals with a DRO can take steps to address their rent arrears and work towards a more stable financial future.