A Debt Relief Order (DRO) only lasts for a year and then your debts in it are wiped out. But it will be shown on your credit record for six years.
This article looks at what should happen to your credit record during the year of your DRO and at the end of it. If some of your creditors have go tt this wrong, you need to ask them to correct any problems.
And finally it looks at how to start to improve your credit rating when the twelve months of your DRO ends. Even if you never want to be in debt again, a good credit score makes it easier to get a tenancy agreement, get a mobile contract and it’s essential if you ever want a mortgage.
Contents
How a DRO should be recorded
To make sure you don’t miss any problems, check your credit records for free with all the Credit Reference Agencies.
This is what should your credit records should show:
After your DRO is approved:
The DRO will show in the Public Record section of your credit record.
All debts which are in your DRO should have a default date which is the date your DRO started or before.
There will be no change for any debts which do not form part of your DRO, but these (things like student debts and magistrates court fines) do not normally show on your credit record at all.
At the end of the 12 months of your DRO:
You don’t get sent a certificate when your DRO completes, see What happens at the end of my DRO? for details. You can print off your Insolvency Register entry when your DRO finishes as proof – but do this quickly as it disappears after three months.
Your credit record will be updated to say your DRO has completed. The DRO marker will remain on your record for five more years, dropping off six years after the start of your DRO.
You no longer owe the debts that were listed in your DRO.
These debts should be marked by the creditors “to show that you no longer owe money on that account (perhaps by marking the entry as ‘partially satisfied’ or ‘partially settled’ or in some other way)” (quote from the Information Commissioner’s Office) and the balance on the accounts should show as zero.
CCJs won’t change, because there is no way to mark them as partially settled.
At the end of six years:
The DRO marker will drop off your credit record.
Some of the DRO debts may already have disappeared. The rest should go at the same time as the DRO marker, because their default date should be on or before the date your DRO started.
CCJs drop off six years from the judgment date, so they also should already have dropped off by this six-year point.
So now your credit record should be completely clean – unless you have had credit problems after your DRO finished.
The only creditors that will be able to tell you had a DRO after the six-year point are those who had a debt included in your DRO. They may still be able to see the DRO on their internal records.
Correcting problems
There are two sorts of common problems.
1) a default date is after your DRO started
If the default date is later (or not there at all!) it will delay the point at which your credit file becomes clear. You can ask the creditor to correct the record.
Don’t ask the credit reference agencies to do this – they just report what the creditors tell them.
It can take a while for creditors to add these defaults. I suggest you wait four or five months after the start of your DRO before you bother to do this – by that time most, if not all, should be right and you may only have one or two to deal with.
Don’t try to do this on the phone. Instead send the following letter to the Data Controller for the creditor (get the address from the ICO ), send it Recorded Delivery and keep a copy:
I had a Debt Relief Order approved on dd/mm/yyyy. You can confirm this by checking the Insolvency Register at https://www.insolvencydirect.bis.gov.uk/eiir/.
I am writing to ask you to correct my credit file for [details of your debt with the creditor, including account number or reference number].
At the moment [there is no default date/the default date is dd/mm/yyyy]. This is incorrect and a breach of the ICO guidelines and the Data Protection Act 1998. There should be a default date not later than the start date of my DRO.
Please correct this entry within 28 days or supply me with a written reason why you will not do so.
If the creditor replies saying they don’t know anything about your DRO, talk to the DRO Unit about whether the creditor has been informed.
If the creditor knows about your DRO but refuses to add or correct the default date, complain to the ICO. Attach copies of your letter to the creditor, proof of posting and any reply from the creditor.
One exception – mortgage shortfall debts are unusual in a DRO but if you have one, read How to repair your credit record after bankruptcy which covers these debts.
2) Creditor doesn’t mark debt as satisfied when your DRO has finished
The creditor doesn’t have to mark the debt as fully settled/satisfied so there is no point in complaining if the debt has been marked as partially settled/satisfied.
Give them a few months after your DRO has ended to deal with this. There is no hurry, your credit record isn’t going to get up to being good for another five years.
But uf after say four months a debt is still showing an open balance, send the following letter to the data controller for the creditor:
My Debt Relief Order finished on dd/mm/yyyy. I attach a copy of my Insolvency Service Register entry which shows this.
I am writing to ask you to correct my credit file for the above debt. The ICO guidelines state that my credit file should show that I no longer owe money on that account, perhaps by marking the entry as ‘partially satisfied’ or ‘partially settled’ or in some other way.
Please correct this entry within 28 days or supply me with a written reason why you will not do so.
Again, complain to the ICO if a creditor doesn’t correct the entry.
What if my debt was sold after my DRO started?
Say creditor A (who may be the original lender) sold the debt to creditor B.
The important thing is who owned the debt at the relevant time…
So if creditor A owned the debt when the DRO started, they should have added the default to your creditor record at that time. If they didn’t write to them and tell them to do it. Then when that is done, write to creditor B and say you had a DRo and creditor A has now added a default date of dd/mm/yy and ask them to do the same.
If creditor B owned the debt at the time your DRO year ended, they are the one that now needs to mark the debt as settles in some way. Write to them about it.
Is it worth doing this?
Yes. It is worth correcting the dates of default unless they are just a bit late. If these are months or even years late, this will delay the time until your credit file is finally clean as these debts will still be showing when your DRO itself has disappeared.
It’s a long while – five years or more – until a debt in your DRO will drop off your credit record completely, so it’s a good idea to get them all correctly marked to show that you no longer owe any money. This doesn’t change your credit score, but it may mean that you are more likely to be able to get credit, probably from a “bad credit lender”.
Having the debt marked as settled also stops the irritation of the debt being ‘sold on’ to another Debt Collector. That isn’t a serious problem – the debt really has been written off – but it is annoying as you have to correspond with yet another person and send them details of your DRO.
Getting positive markers on your credit file
Once your DRO has ended, it’s good to start getting some new, positive credit marks on your credit record. there is no hurry to do this as your credit rating is going to remain poor for 5 years, but after a while you may want to do what you can to start things going in the right direction.
Can you save regularly?
If you can, then read up about LOQBOX. This is a clever new product that lets you save each month for a year and reports this to the credit reference agencies as loan repayments – so your credit score will benefit as you have taken out a year-long loan and repaid it. There are no fees and you will definitely be accepted for this, no matter how bad your credit score is.
At the end of the year, you will have a nest egg saved up and a better credit score.
Get a “bad credit” card
First deal with the “clean up” process outlined above for your old debts. And make sure that you are on the electoral roll, your address and any other details are all correct with the credit reference agencies. This may take several months to complete if you have to go to the ICO.
Then apply for a Vanquis or a Luma credit card. Vanquis is owned by Provident, Luma is owned by Capital One – if you had a debt to one of these companies in your DRO apply to the other one to maximise your chance of being accepted. If your application is rejected, double-check your credit file really is clean with all three credit reference agencies, wait a few months, then apply for the other card.
These cards charge very high rates of interest. This doesn’t matter because you should aim to repay it in full every month, so you never pay any!
The best thing is to use it once a month for something small such as a tank of petrol and set up the card to be repaid in full automatically every month so you can never forget and pay late.
Your credit rating will improve faster if you repay the full balance every month,
At some point, you will probably want to be able to get affordable credit to spread the cost of a purchase. This is a good time to prepare for that by getting a savings account with your local credit union. don’t plan to use your horribly expensive credit card, or you will be heading back into debt problems again.
This all takes time
If you were expecting the end of your DRO to make a large, immediate improvement to your credit score, it doesn’t.
Getting a bad credit card or saving through LOQBOX isn’t going to magically increase your score to good. But when the DRO and all the debts in it disappear, having these positive markers then will mean that your credit score is looking good, not just empty.
Never pay any firms offering a ‘repair your credit’ service because either they don’t work at all, or they will be only suggesting what I have said here – there are no shortcuts. The template letters here are very likely to work and if they don’t, putting in a complaint to the ICO is the best way to repair your credit.
How much will my credit score change if…
Amigo – not a good way to rebuild credit score
What happens at the end of a DRO?
Jade says
Hi there,
My debt relief order was granted in March 2017, and then discharged as of March 2018. I have checked my credit file and seen that three of my debts included in the DRO are still open and showing defaults up until this day. They are also not being shown as settled/partially settled or satisfied. I was contacted by one which was a car finance company and they are still asking me to pay and changed the amount I need to pay as seen on my credit file. It has been two years since I’ve had my DRO. Should I send a letter asking them to close the account and put the balance to zero?
I’ve managed to get two credit cards with in this time.
Do you think it’s worth getting LOQBOX to help my credit aswell?
Thank you
Jade
Sara (Debt Camel) says
You need to ask all the creditors who have not marked your debt as closed/satisfied in some way to do this. use the letters in the above post. In particular, you need the car finance company to acknowledge that your debt was included in your DRO and so has been cleared.
Your credit cards. are you using them every month and repaying them in full every month?
Jade says
Hi,
Thank you for getting back to me so quickly.
Yes, I am using them and paying them off in full every month.
Also do I pay them off before they generate my bill? So I don’t pay interest or do I pay it before my bill is generated?
Thank you, I will write to them asking them to clear the balance and hopefully removed the defaults after my DRO, so I can continue to try and build credit.
Sara (Debt Camel) says
“do I pay them off before they generate my bill?” Your bill will not contain any interest (well assuming you haven’t taken cash out, or used the money for gambling or foreign exchange). I would tend to wait for the bill then pay the amount on that, so it’s not possible to pay the wrong amount and then get charged interest.
Jade says
Thank you, do you think it’s worth me apply to LOQBOX?
Sara (Debt Camel) says
Do you have spare money that you can afford to save each month? If you do, then LOQBOX is a sensible option – you could put £20 or £30 a month away and you would have completed the years saving and have the money for Xmas 2020?
But if you would struggle to save regularly, then I wouldn’t bother.
Kirsty says
I was granted a DRO last October and it finishes October 11th this year, do I need to send my bank details to them or anything to prove my circumstance haven’t changed?
Sara (Debt Camel) says
No! It is just assumed your situation hasn’t changed. There is no final review.
Amanda Mitchell says
Hello
I have two debts on my credit file that show a default date two months after my DRO started (I will write to them to ask them to put it right) and while both show zero balances, there is nothing to say “partially settled” or “settled”. To me it looks as if the accounts are still in default. Is this right or wrong? I’m not in default now as I don’t owe them anything.
Sara (Debt Camel) says
Are they showing a new default being added each month? Or has that now stopped?
Amanda Mitchell says
That has stopped in favour of the statement “no data available”. However, I have also discovered another account that was included in the DRO which is still showing a balance of £131. It also seems to be showing missed payments up until a few months after the moratorium period started. Show that now be zero?
Sara (Debt Camel) says
Yes, all balances owed should be zero
Kate says
Hi Sarah.
DRO ended January 2019 and credit karma is showing two company’s are showing as open accounts in default but clear score is not showing any open accounts what do I do? Thank you
Em says
Hi,
I sent letters out to some creditors who had the default dates wrong, one of which still had the loan open on my credit file.
They have responded today to state that I need to provide copy of DRO and list of creditors. I have a screenshot of the DRO but why should I be telling them who I owed money to? Surley that is data protection and all they need to worry about is the loan to them
Kirsty Moon says
Hi
How long does it take for the bad mark on your credit file to be deleted from your credit file?
Its been 6 years today since my DRO should it just drop off??
Sara (Debt Camel) says
yes it should!
Karl Jackson says
Hi,
Intrigued to know if the dro dropped off and how it affected your credit score, my is due to come off in Feb and I’ve kept really good credit over the last 2-3 years.
Thanks in advance
Kate says
Hi Sara.
DRO ended January 2019 and credit karma is showing two company’s are showing as open accounts in default but clear score is not showing any open accounts what do I do? Thank you
Steve says
Hi my dro finished in august last year trying to rent house but they say I’m a bad risk Evan though never misssed payment on rent ever do I have to declare my dro when applying to rent and should it have any bearing on my apillity to pay rent
Sara (Debt Camel) says
you don’t have to declare a DRO but many agents will do a credit check.
Michael says
The link in the letter (https://www.insolvencydirect.bis.gov.uk/eiir) only shows entries for those who are still within the moratorium period. The DRO should drop off my credit file in the next couple of days, however there is 1 creditor who still has defaults on my file to exactly 1 year after my DRO started. There is no certificate so I have no proof, is there anything I can do?
Sara (Debt Camel) says
There are two sorts of problems with credit record after a DRO.
Some creditors haven’t marked the debt as being satisfied – then you need proof your DRO completed to show them – If you didn’t print the record off from https://www.insolvencydirect.bis.gov.uk/eiir in time, or you later lost the printout, you can tell a creditor who wants proof your DRO has finished to contact the Insolvency Service’s DRO team to get confirmation.
But if the default date is wrong, you need to go through the process described in the article above in A default date is after your DRO started to get the date corrected.
Nik says
Hello, I applied for a DRO, and was initially approved but then it was revoked due to an error made in the application from bad guidance from the charity helping me through the application. It’s still showing as having a DRO on my credit file – please can you advise on how to get this removed? Many thanks. Nik
Sara (Debt Camel) says
That sounds very unusual – can you say what the error was?
Star says
I was issued a DRO in 2014. There are two accounts on my credit file that are showing as open and defaulted. They’re were included on my DRO, however I cannot remember the account numbers to contact the companies.
Sara (Debt Camel) says
the account numbers would have been on the DRO application.
if you can’t find them, then you just have to write the creditors a vaguer letter saying that the credit record entry for you – attach it – is inaccurate because the debt was included in your DRo which started on dd/mm/yy and s=complated a year later.
Liam Bilton says
Good morning, my first year of my DRO was up last March, therefore nearly on my second year and my debts included all appear on my file still as a balance and not £0 and all state defaulted – not satisfied, particularly satisfied etc.
What should I do about this? Should I write to them all using the template you have shared?
Your help would be hugely appreciated.
Many thanks
Sara (Debt Camel) says
Yes, this is a good time to start the “clean up process”
Liam says
Thank you, once I’ve sent these letters do they have to action it and will I only know if they have if I keep checking my credit report?
Thanks
James says
A few years ago I was granted a DRO with all my debts included. A few of these debts were subsequently sold to Moorcroft even though I had made the original companies aware. These debts are still showing as open accounts on my credit report even though the rest of my DRO debts are closed / “satisfied”.
I’ve raised a dispute with TransUnion who couldn’t help and told me to get in touch with the companies. The companies couldn’t help and told me to speak to Moorcroft who in turn sent me back to the companies.
The credit report is still showing the original company, is it them who needs to close it and should my next step be the Ombudsmen?
Sara (Debt Camel) says
Are all the debts marked as defaulted on or before the start date of the DRO? If not, ask the creditor who owned the debt at the start of the DRO to correct/add the default date.
If the debt isn’t showing as settled/partially settled in some way (reports differ0 then ask the creditor who owned the debt at the end of the DRO to correct that. You can put in a complaint and send it to the Ombudsman after 8 weeks. Or send it to the ICO.
Emma says
Hi,
I sent letters out but been told that the debt is still open on my file and that Its not a mistake.. What do I do now? This is after I sent them copy of DRO etc.
Sara (Debt Camel) says
Is this in writing? Or on the phone? Have they denied the debt was in a DRO or said they had no evidence the DRO had ended?
Emma says
Neither they just stated that their records were not wrong.
This is what they said
We can’t amend your credit report because the data supplier has not authorised any changes. If they say the information is correct, we can’t change it. If they don’t reply during the statutory 28 days we suppress the item. We’d advise you to contact the supplier directly to discuss this matter further.
Who would the supplier be? This one is with Satsuma Loans, I thought they would be the supplier?
Wendy says
Hi sara
My debt relief order finished on the 8th November 2019.
After I completed it I had realised that I had forgotten to put a payday debt into it and at the time the citizen advice lady who helped me with it told me it was too late to put it.
This morning I received a letter from QDR solicitors with the payday debt and another payday debt which was included in my DRO. What do I do about it sara? I am not sure where to go with it. These solicitors bought the debt from Lantern debt recovery services limited.
Sara (Debt Camel) says
who was the lender for the debt you did not include? when did you take out the loan? had you had other payday loans from that lender before the last one?
Wendy says
Hi sara thanks for your reply
The lender was sunny and I took it out january 2015 and I only had the one loan from sunny.
Sara (Debt Camel) says
I was hoping you might be able to win affordabilty complaint about the loan – but as there was only one, that is unlikely. How much is the current balance?
Wendy says
It is for £601 and I am worried they may issue a ccj while I am trying to clean up my credit score
Sara (Debt Camel) says
If you offer monthly payments they are much less likely to go for a CCJ. Any chance of making a full & final settlement offer?
Did you borrow from any other payday lenders? If you could win any payday loan affordability complaints that could get you some money to settle it?
Wendy says
I might offer a full and final settlement offer and see what they say sara thank you. I have already won complaints from wonga but that was a few years ago. Thank you for your advice sara