30/10/2019

Scotland’s debt advice landscape set to be ‘transformed’

30/10/2019

Scotland’s debt advice landscape set to be ‘transformed’

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New changes to the Debt Arrangement Scheme by the Scottish Government have been heralded as ‘transformational’ by Scotland’s debt specialist Carrington Dean.

Speaking of the reform, which is set to be rolled out across the country on Monday, November 4th, Carrington Dean’s Head of Operations Graeme McLeod said: “The changes being introduced are the most far-reaching in the last 15 years of the Scheme’s existence and will help thousands of Scots get on top of their debts”.

No more fees

From November 4 the new regulations, which have passed through the Scottish Parliament, will abolish all professional service fees for new cases.

This will mean going forward there will be no charge to enter into the Debt Arrangement Scheme – even if you use a professional provider like Carrington Dean.

It will also mean every penny that you pay will go to reducing your debts.

The changes aim to make it easier for people struggling with debt to access help.

What is the Debt Arrangement Scheme?

The Scottish Debt Arrangement Scheme is a formal debt repayment plan that was introduced in Scotland in 2004. It is unique in the UK, with there being no comparable Scheme in England, Wales or Northern Ireland.

It is not a type of bankruptcy, so it doesn’t involve you selling your car or home.

It also freezes all interest, penalties and charges on your debts and protects you from sheriff officers who are trying to arrest your wages or freeze your bank account.

Importantly, if you are one of the 70,000 Scots each year who get their wages arrested, for debts like Council Tax, if you enter into the Debt Arrangement Scheme, a Debt Payment Programme lifts that arrestment.

Another important feature of the scheme is where you have multiple debts, you don’t need to pay them individually, as your payment distributor does it for you, with you just making one payment each month.

 

Level playing field

Speaking of the new changes, Graeme McLeod, Head of Operations for Carrington Dean said: “The new regulations will transform the debt advice landscape in Scotland.

“Before if you wanted to access the Debt Arrangement Scheme and not pay for it, you had to go a Citizen Advice Bureau or a debt charity”.

“However, with these new regulations, we will now be able to offer our professional services for free and on the same terms that the debt charities have done for years.

“In the past, we have had to charge for it; after November 4th we won’t need to”.

What else is changing?

In addition to the changes that are being introduced to make creditors share the cost of helping people with debts, the Scottish Government is introducing other changes that will make it easier for people to apply to the Debt Arrangement Scheme and remain in it.

These include:

  • Proposals being automatically approved if those creditors objecting have less than 10% of the total debt;
  • Making it easier to increase or reduce the amount you pay when you are in the Scheme; and
  • Allowing up to two payment breaks each year, where you experience an unexpected crisis.

Carrington Dean and the Debt Arrangement Scheme

Carrington Dean is the largest payment distributor operating in the Debt Arrangement Scheme market and has thousands of cases under its management, including cases that are being delivered by Citizen Advice Bureaux and Local Authority Money Advice Services; in addition to that it has thousands of its own clients that it has been supporting over the last ten years.

For more information and to discuss the Debt Arrangement Scheme with a Carrington Dean Money Advisor call 0808 2085 195

You could write off up to 75% of unsecured debt with our debt assistant.

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