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More than 4 million fear they`ll be made redundant Consumers took on more mortgage debt in July Debts called in by parents Teenagers `scared of debt` Rising household costs could pressure people in debt Pensions debt may impact workers` retirement funds Welsh young adults `at highest risk of debt problems` Over 50s can`t afford to enjoy retirement because of debts Budget: tackling the nation`s debt Short-term debt: `no need for price control` The cost of clearing debt Education debt Tackling the national debt Number of mortgage deals on offer exceeds 3,000 Almost 5 million take on debt to pay household bills OECD: household debt more than 120% of disposable income Petrol price falls help people in debt Amount of mortgage debt taken on at lowest level in ten years Northern Ireland sees significant IVA rise Overdraft debt `becoming more expensive`

Debt Relief Order (DRO) rules may be changed

25/02/2010

The rules about Debt Relief Orders (DROs) may be relaxed, the BBC reports, allowing more people to clear `modest` debts through this new form of insolvency.

Introduced in April last year, DROs were designed to help people in England or Wales who have few assets, limited income and relatively low debts (less than £15,000). To qualify for a DRO, borrowers` assets must not be worth more than £300 in total (although they can own a car worth up to £1,000).

However, that `total` includes any pension pot they may have, and this has stopped many people using a form of insolvency that would otherwise be a suitable way of clearing their debts.

Sue Edwards, Head of Consumer Policy at Citizens Advice, said that: "We have been very concerned in the past that people who fulfil most of the criteria for a DRO were having their applications rejected because of very small pension funds.

"In a new survey," she continued, "we found that 96.3% of the people we spoke to were excluded from the DRO only because of their pension, and 78% of these people had a pension fund of less than £5,000."

Now, the Department for Business is considering making changes to the way DROs work to stop this from happening. As Business Minister Ian Lucas said: "Following representations from independent money advisers, I`m proposing a common sense change to ensure that vulnerable people with a very small pension pot are treated fairly."

Since they were introduced, we`ve seen 11,831 people enter a DRO to clear their debts. In the same time, 54,224 people in England and Wales have entered bankruptcy, and 37,834 have entered an IVA (Individual Voluntary Arrangement).

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).

More than 4 million fear they`ll be made redundant 16/12/2010 - According to R3`s quarterly personal debt tracker, more than 4 Consumers took on more mortgage debt in July 26/08/2010 - Consumers took on £2bn more mortgage debt than they repaid Debts called in by parents 26/08/2010 - According to research, `the bank of Mum and Dad` is Teenagers `scared of debt` 19/08/2010 - Nearly two thirds of teenagers are `scared` of debt, according