How the Scottish Bankruptcy Reform could affect you and you debt

July 8, 2013

Scotland’s insolvency service, Accountant in Bankruptcy (AiB) published a report of proposed changes to bankruptcy legislation in November 2012, describing them as ‘a vision for debt advice, debt management and debt relief service in Scotland, fit for the 21st century’ and to provide ‘fair and proportionate’ debt relief for Scottish residents. The bill is expected to be fully implemented in 2014.

So what are the proposed changes and how will they affect you? Some of the more significant changes include the Debt Arrangement Scheme (DAS). The DAS allows interest and creditor chasing to be frozen while the debtor pays back the money owed. The proposed changes will allow interest to be frozen from an earlier date that previously agreed, saving around six week’s worth of interest for those in debt.

Scotland’s minister for energy, enterprise and tourism, Fergus Ewing, said: “The Debt Arrangement Scheme (DAS) has proven to be a very successful initiative and provides a viable solution for people in debt. It is a real alternative to bankruptcy which should always be looked on as a last resort.

“The reforms provided for in this bill ensure that our law on debt relief can deal with the challenges we face in modern society, providing appropriate solutions and protection to both those in debt and their creditors.”

Changes to the bill include the introduction of a new ‘minimal asset process’ route, changes to the electronic applications and a requirement for creditors to submit claims within 120 days. These, and other changes which may affect you, can be discussed in more detail with a specialist adviser.

So if you’re curious as to how the changes might affect you, our friendly and knowledgeable team at Scotland Debt Solutions can offer you the advice you need on what route is best for you.

Ultimately, the decision to declare bankruptcy should always be a last resort, and changes to legislation could provide you with another option. Debt solutions are always best discussed with a specialist adviser who can provide impartial advice on what’s best for your situation. Why not call Scotland Debt Solutions today for more information on how the Scottish Bankruptcy Reform could affect you.

John Baird

Insolvency Adviser

Tel: 0800 063 9250

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