A Debt Arrangement Scheme (DAS) is a government managed debt solution which will allow you to repay your debts through a Debt Payment Program (DPP).
The DPP will allow a debtor to pay off their debts over an extended period of time while giving them protection from their creditors taking action against them to recover the debt in the DPP. The DPP can last for any reasonable length of time and, if approved and will freeze all interest, fees and charges on the debt included, resulting in them being written off if the debtor fully completes the DPP.
Advantages of a Debt Arrangement Scheme
- Most forms of diligence such as arrestment of your bank account or earnings arrestment will be cancelled under a DPP
- If you have tried to negotiate with your creditors before and they have refused, a DPP will be particularly useful to you
- If you keep up with agreed payments under the DPP your creditors cannot take you to court and take enforcement action against you.
- Interest, fees and charges are frozen after your DPP is approved
- A DPP is a good option if your creditor is threatening sequestration(bankruptcy).
Disadvantages of a Debt Arrangement Scheme
- The disadvantage the DAS has is that there is no debt forgiveness – i.e. all the debt (excluding interest and charges mentioned above) needs to be paid back.
- Your credit rating will be effected by entering into a DAS.
All debt solutions should be very carefully considered. Fees will be charged if a solution is taken in order for us to set up your plan and maintain it – all fees will be outlined during your consultation. Retained payment may place you further into arrears. You have the right to a cooling off period of 14 days. It is likely that your ability to obtain further credit in the short term will be affected and this may also be the case over the medium to long term.
There is free debt help and advice available through a variety of debt charities. For more information, we recommend you visit http://www.moneyadvicescotland.org.uk/
For further information on debt solutions and their effects, AIB has produced a debtor’s guide available here.Check to see if you qualify