Debt Arrangement Scheme (Scotland Only)

A DAS allows you to make regular monthly payments, calculated in accordance with your current financial situation. You will still have enough money left over to afford a reasonable standard of living, it gives you more control over your finances compared to other debt solutions. You will not have to sell your assets including your car or property, as you may have to do this with a Trust Deed or Sequestration.

The amount you pay will be evenly distributed amongst your creditors each month, part of your monthly payment will cover the fees. All interest, fees and charges that are being applied to your eligible debts will be frozen. Your creditors will be unable to contact you or take additional legal action against you. The flexibility allows you to alter your monthly payments or apply for a 6-month payment break if your financial circumstances are due to change.

Once this debt payment programme has been completed, your debts will be written off. However, it is important to remember that you will still have to pay any outstanding debts that were not included in the initial application as well as debts that aren’t eligible for inclusion within the Debt Arrangement Scheme.

If you have decided that a DAS is the right solution for your circumstances, we will put you in contact with a professional money advisor, should you need further help or advice, we’ll be right here to help.

The money advisor will help you set up and complete the Debt Arrangement Scheme. He/she will confirm that you understand how the DAS will work. At this stage, you will have to provide details about your income, assets, debts and creditors. These will be reviewed with you, and you’ll be able to agree on an affordable monthly payment. This process will ensure that all eligible debts are included within the DAS.

DPPs under DAS can be set up by a privately licensed debt management company. Each individual company may charge a different set-up fee. Once a DPP is approved, 10% of your monthly payments will cover the running costs of the programme. This 10% fee will cover the day-to-day management, correspondence and distribution of your payments to your creditors, in addition to carrying out regular financial reviews of your circumstances. This percentage is set by law.

The amount you will pay each month is usually calculated by identifying what your disposable income will be. This is how much money you have left over after covering your main expenditure. If there is a change in circumstances, e.g. a pay rise or loss of work, this will be reviewed, and you will have the opportunity to increase or decrease your monthly payments accordingly.

If you want to apply for a DAS, you must meet the right criteria in order to be considered eligible. The following must be met:

• You’re able to make contributions to your debts
• You must currently live in Scotland
• You owe money to one or more creditor(s)
• Your monthly disposable income must be at least £100

You will make monthly affordable payments to your DPP under DAS. This money is distributed between the creditors that you owe money to. 10% of your monthly payment will be deducted to cover the administration costs. The payments distributor will retain 8% and 2% will be sent to the Accountant in Bankruptcy (AiB) who acts as the administrator and oversees the DAS on behalf of the Scottish Government.

A Debt Arrangement Scheme is designed to help you manage debts in a more affordable way. If you’re struggling with any of the following ‘non-priority debts’ listed below, a DAS may help you become debt free.

• Personal loans
• Pay day loans
• Credit cards
• Store cards
• Catalogues
• Overdraft, including fees and charges

There are also ‘priority debts’ which can be included within a DAS, these priority debts may include council tax arrears, benefit overpayments and utility debts such as gas, electricity or water.

You will not have to sell your home. Other debt solutions may require you to sell your home in some scenarios.