The Debt Arrangement Scheme (DAS) is a formal debt management solution available for residents living in Scotland. DAS allows you to freeze interest and charges on your unsecured debts as long as you keep up with your monthly debt repayments. It is an alternative to a Trust Deed. The Debt Arrangement Scheme can prevent your creditors from taking a legal action on you.
To calculate how much your repayments are your income and expenditure is taken into consideration including rent/mortgage, secured loans, utility bills, and essential living expenses (food & TV license etc.) and the surplus is your disposable income which is then distributed to creditors on a pro-rata basis until the debts are paid in full. This may mean repaying debts over a longer term than was originally agreed.
Once your debt payment programme (DPP) becomes approved you are protected from any further creditor recovery action. They cannot add any further interest or charges to your accounts and any assets you have are completely protected.
A charge is made to creditors for the provision of the payments distribution service and application fee. The legislation states the maximum fee to be charged for the application is 2% and the payment distributor’s fee must not be more than 8% of the amount due to be paid to a creditor.
Therefore, if you complete the programme under DAS, creditors will receive a minimum of 90% of the debt owed to them.