Renting a property comes with its own set of responsibilities, one of which is ensuring timely payment of rent to the landlord However, there are situations when tenants may fall behind on rent payments due to financial difficulties In such cases, tenants may find themselves in debt and facing the possibility of being taken to court by their landlord One option that tenants in the UK have in such situations is to consider Debt Relief Orders (DROs) to deal with rent arrears.
What is a DRO?
A Debt Relief Order (DRO) is a form of insolvency solution available in England, Wales, and Northern Ireland for individuals who are unable to pay off their debts It is aimed at people with low income, minimal assets, and debts under a certain threshold DROs typically last for a year and provide relief from debts during this period At the end of the DRO period, the debts included in the order are usually written off, giving the individual a fresh start.
How can a DRO help with rent arrears?
If a tenant is struggling to pay their rent and has other debts that they cannot manage, applying for a DRO can be a viable option Including rent arrears in a DRO can provide relief to the tenant and prevent the landlord from taking legal action to recover the unpaid rent It is important to note that while rent arrears can be included in a DRO, ongoing rent payments are the responsibility of the tenant and must be maintained throughout the DRO period.
Steps to take when dealing with DRO rent arrears:
Assess your financial situation: Before considering a DRO, it is essential to assess your financial situation and determine whether you meet the eligibility criteria for a DRO You must have debts totaling less than £20,000, assets worth less than £1,000, and a disposable income of £50 or less after meeting essential living costs each month.
Seek advice: It is advisable to seek advice from a debt advisor or a Citizen’s Advice Bureau before applying for a DRO They can help you understand the implications of a DRO and explore other debt solutions that may be more suitable for your situation.
Apply for a DRO: If a DRO is deemed suitable for your circumstances, you can apply online through an approved intermediary dro rent arrears. The application process involves providing details of your income, expenses, debts, and assets Once approved, your creditors will be notified, and a moratorium period will be in place, during which they cannot take legal action against you.
Include rent arrears: When applying for a DRO, make sure to include your rent arrears in the list of debts This will provide temporary relief from the pressure of rent arrears and prevent your landlord from pursuing legal action to recover the unpaid rent.
Maintain ongoing rent payments: While rent arrears included in a DRO may be written off at the end of the DRO period, it is important to continue making regular rent payments to your landlord to avoid further arrears and maintain a good relationship with them.
Monitor your finances: During the DRO period, you will be required to adhere to certain restrictions, such as not obtaining credit over £500 without disclosing your DRO It is crucial to monitor your finances closely and ensure compliance with the terms of your DRO to prevent it from being revoked.
Seek support: Dealing with rent arrears and financial difficulties can be stressful, and it is essential to seek support from friends, family, or support services to help you through this challenging time Maintaining open communication with your landlord and keeping them informed of your situation can also help alleviate any concerns they may have.
Conclusion:
Rent arrears can be a significant source of stress for tenants facing financial difficulties However, exploring options such as Debt Relief Orders (DROs) can provide relief from rent arrears and other debts, allowing individuals to make a fresh start By taking proactive steps, seeking advice, and communicating openly with landlords, tenants can effectively deal with rent arrears and work towards improving their financial situation.
Renters facing financial difficulties and looking for solutions to deal with rent arrears can consider applying for a DRO to find relief from debt burdens and avoid legal action from landlords It is essential to assess your financial situation, seek advice, apply for a DRO, include rent arrears in the order, maintain ongoing rent payments, monitor your finances, and seek support to navigate through this challenging period By taking the necessary steps and utilizing available resources, tenants can overcome rent arrears and move towards financial stability.