How does a DRO affect my credit score?
A DRO stays on your credit file for six years from the date it is approved. This makes it harder to take out credit.
Lenders have their own ways of interpreting your credit score:
- Some rate your recent history more highly
- Some do not lend to anyone who has ever had a default
While on a DRO:
- You cannot take out more than £500 in credit without telling the lender about the DRO
- They may not want to lend to you because of it
A DRO is viewable on the public Individual Insolvency Register.
Can I get a DRO removed from my credit file?
You cannot get a DRO removed from your credit file.
Your credit file is updated when the DRO ends.
- It is shown as 'discharged'
- The DRO period is usually 12 months
Let the credit reference agencies know if your credit file has not been updated.
Check that the accounts included in your DRO are marked as:
- 'Satisfied', or
- 'Partially settled'
You can apply for a ‘notice of correction’ if you got a DRO for reasons outside your control.
- This is a short statement of up to 200 words that you send to the credit reference agencies
- Ask them to make the statement available to potential creditors
- Creditors may take this into account when deciding to lend to you
How can I improve my credit score after a DRO?
Improving your credit score can take time, but you can do it.
Make sure that:
- You keep up with all agreed payments on your debts, including:
- Mobile phone bills
- Credit cards
- All the details on your credit score are correct, such as where you live
- You register on the electoral roll where you live
There are some credit cards for people with bad credit scores. Read about what to consider before applying for one.