Credit rating - impact of debt relief order

This advice applies to Wales. See advice for See advice for England, See advice for Northern Ireland, See advice for Scotland

If you've got a debt relief order (DRO) or have had one in the past, it will affect your credit rating. This could mean you find it more difficult to get credit in the future.

This page explains what you need to know about how a DRO could affect your credit rating.

Your bank account

The Official Receiver won't tell your bank about your DRO, unless your bank is listed as a creditor. But some banks automatically check whether any of their customers have been given a DRO.

If your bank is included in your DRO or it finds out you have one, it's up to them to decide whether to freeze your account or let you open a new one.

What is your credit rating?

When you apply for a loan or other type of credit, the credit provider will search your credit reference file to see how much of a risk it is to lend to you. The level of risk is known as your credit rating. It can be affected by your personal financial details including:

  • how you've managed existing bank accounts and credit commitments

  • whether you've ever had your home repossessed

  • people you're financially linked to.

More about your credit reference file and credit rating

Will a DRO show up on your credit file?

Your DRO will show up on your credit reference file. It can reduce your chances of getting credit from some lenders, as it shows you've struggled to keep up repayments before.

You're not allowed to get credit for £500 or more without telling the lender that you have a DRO. A lender might change their mind about offering you credit, when they see a DRO registered on your credit file.

The note of your DRO stays on your credit file for up to six years after the date the DRO was made. This means it could be some time before you can get credit in the future.

You might also struggle to open a new bank account during the DRO period and for some time after it has ended.

If you need a new home while you've got a DRO, you could find that your options are limited. Many private landlords and letting agencies will insist on credit checks when you apply for a tenancy, and because the DRO will show up on your credit report, you may be turned down or charged higher fees.

If you're not comfortable with how a DRO can affect your credit rating, you might want to think about a different debt solution.

Options for dealing with debt

Checking your credit file

Your credit reference file is held by the three credit reference agencies. You can check what information the credit reference agencies are holding about you and change anything that is wrong.

More about how to get a copy of your credit reference file

Next steps

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Page last reviewed on 08 January 2020