Debt Arrangement Scheme - Scotland

Debt Arrangement Schemes (DAS) and Debt Payment Programmes (DPP)

(Only available in Scotland!)

1:    A debt arrangement scheme or DAS is possible if a debtor has only one creditor, as long as the debt is not currently subject to a time to pay direction or time pay order (Debtors        Scotland Act) or time order (Consumer Credit Act).

2:    Also known as Debt Payment Programme, a debt arrangement scheme is not Sequestration or Bankruptcy, it is a government approved Debt Management Plan / solution.

3:    A DAS or DPP will allow a debtor to extend the period of repayment whilst freezing interest and charges being applied to their accounts.

4:    Debt arrangement schemes can last for any reasonable period of time.

5:    Debtors are protected from further creditor action whilst subject to a DAS or debt payment programme.

6:    Only a DAS approved money advisor can apply for a debt payment programme on behalf of a debtor.

7:    A debtor cannot apply for DAS or DPP when already subject to a Trust Deed or Sequestration in Scotland.

8:    DPP's or a DAS is still possible if debts are in joint names

The Pros and Cons of Debt Arrangement Schemes or DPP in Scotland;

The Advantages of a Debt Arrangement Scheme

  • Debt Arrangement Schemes offer one affordable repayment and are government approved.
  • Freezes interest and charges being applied to accounts.
  • Debt Arrangement Schemes can assist in helping to avoid Sequestration> or a Trust Deed..
  • Avoid having to take out further borrowings to clear debt or other financial problems.
  • Debt payment programmes are still possible even if you have been refused a Debt Consolidation Loan.

  • The Disadvantages of a Debt Arrangement Scheme

  • The period of time to repay the total outstanding credit may increase, the debtors credit rating could be affected due to defaults being recorded on their credit file.
  • Credit reference agencies keep account history information such as late or missed payments and can be held on a personal credit record for up to 6 years.
  • A Debt Arrangement Scheme is recorded and each debtor will be on a public register listed by full name, date of birth and home or business address.
  • The information on a credit file can influence lenders decisions and can affect consumers when trying to obtain other credit such as mobile phone contracts or mortgages.