What are the pros and cons of a Debt Arrangement Scheme?

20 June2011

If you're a resident of Scotland, and you're struggling with your unsecured debts, you may find that a Debt Arrangement Scheme (DAS) can help.

A Debt Arrangement Scheme is a statutory scheme designed to allow eligible borrowers to repay their debts over a longer period of time than they originally agreed to.

Setting up a Debt Arrangement Scheme involves speaking to a DAS-approved money adviser. This adviser will then speak to your creditors on your behalf, asking them to agree to the terms of your Debt Payment Programme (lower monthly payments over a longer period of time and a freeze in interest).

Your creditors will be given time to respond to your money adviser - and providing they agree to the DPP, they'll be bound by the agreement for as long as you stick to it. If some of your creditors don't respond, they'll be treated as if they've agreed, and they'll be bound by the programme too.

Even if your creditors don't approve of your Debt Arrangement Scheme, the DAS Administrator can actually approve it anyway - if it seems fair and reasonable to do so.

Once your agreement begins, you'll start making regular payments to your payments distributor, who will share the money out amongst your creditors according to how much you owe each of them.

How could I benefit from a Debt Arrangement Scheme?

Here's a quick look at some of the 'pros and cons' of a Debt Arrangement Scheme, to help you make a more informed decision about this debt solution.


  • You will only pay what you can afford each month towards your debts. This amount will be based on what you've got left after covering your essential expenses (mortgage/rent payments, food, bills, etc.).
  • You'll stay in your home. A Debt Arrangement Scheme won't have an effect on your home (although you'll have to keep making your mortgage/rent payments, as usual).
  • The interest (and other charges) on your debts will be frozen. This means your debts can't grow any more while you're repaying them.
  • Your creditors won't be allowed to pursue you for the money you owe anymore.


  • You'll be in debt for longer - because you'll be making lower monthly payments.
  • Your credit rating will be damaged - because you'll be defaulting on original repayment agreements. You'll also have your name added to the DAS Register, which will prevent you from borrowing any more money while your agreement is underway.
  • Other debt solutions have a set 'timeframe' (an IVA (Individual Voluntary Arrangement), for example), whereas your DAS will only come to an end once your debts have been fully repaid.

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Tags: Debt Arrangement Scheme, Scotland, debt, Debt Payment Programme

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