Debt Arrangement Scheme Advantages:

• You will get to make a lower, more affordable offer of payment towards your unsecured debts, making them more manageable.
• Interest and charges on your debts will be frozen – meaning they won’t grow even though you’re repaying over a longer amount of time.
• Your debts will not be allowed to continue to chase you for the money you owe them provided you maintain payments through the Arrangement.
• An approved Money Adviser will guide you through the process and negotiate with your lenders for lower payments on your behalf.

Disadvantages:

• You will not be allowed further credit while on a Debt Arrangement Scheme.
• If your Debt Arrangement Scheme fails, your creditors may request to have you sequestrated (Scottish Bankruptcy). This is unlikely, however this will always be discussed before your Arrangement commences.
• By entering in to a Debt Arrangement Scheme your credit rating will be affected as you will no longer be maintaining contractual payments to your debts and therefore have defaulted on them. This will affect your credit rating for up to 6 years following completion of the Arrangement and will therefore affect your ability to obtain credit no and in the future.