Comparing the cost of DAS, Sequestration and Trust Deed

February 1, 2017

In Scotland there are 3 main options for those struggling with problem debt. Each one comes with its own positives and negatives, and also its own financial cost – both initial and on-going. Here we compare the 3 choices available to you and how the costs of each stack up:


What is it?

A Debt Arrangement Scheme (DAS) allows you to repay your debts at a rate that’s affordable to you. This is done by making a single monthly payment which is then spread among your creditors. With a DAS, you will repay all of your debts in full, just over a longer period of time than you would without the scheme in place. A DAS is only an option if you have enough income left over each month, after your living costs, to be able to pay your debts over a reasonable period of time. Your creditors must agree to the terms of the DAS including the level of payment you can offer them.

What are the set-up fees?

You should not have to pay anything up front in order to set up the DAS. Instead 10% of your monthly payment is taken as fees to cover the running costs; the rest goes towards paying off your debts.

How does it affect my assets?

As you will be paying off the full amount that you owe by way of your monthly payment, the plan doesn’t consider any assets you have and therefore you do not have to worry about being forced to sell your house or car.

What are the on-going costs, and how long will this go on for?

The premise of a DAS is that you make one monthly payment which will satisfy all your outstanding creditors. This payment will therefore be an on-going cost to you. There is no set timescale for how long the DAS will be in place for, rather this payment will continue until you have cleared what you owe in full.


What is it?

Sequestration is the term for bankruptcy in Scotland. It typically allows for up to 100% of your debts to be written off, leaving you chance to start again with a clean slate. Sequestration is a formal insolvency process and is therefore a serious step to take. When sequestration has been entered into a Trustee will take control of your estate and from then on will deal with your creditors on your behalf.

What are the set-up fees?

It costs £200 to apply for sequestration.

How does it affect my assets?

Any assets of value may have to be sold in order for the proceeds to be passed onto your creditors to reduce the amount you owe them. This can include your home and any vehicles you own. There are certain exclusion to this such as items required for day to day living, furniture, and children’s belongings. You are also allowed to keep a car up to the value of £3,000 so long as this is required by you, e.g. to travel to work.

Depending on your circumstances you home may be at risk. The level of equity in the house will be taken into account, as well as any children or other dependents also living there. It is vital that you seek expert advice if you are considering sequestration.

What are the on-going costs, and how long will this go on for?

You are normally discharged from sequestration after 12 months and you will then be free of debt. However, depending on your circumstances, you may have further obligations. If you are in paid employment and can afford a financial contribution, then you will be required to make a monthly payment for a period of up to four years.


What is it?

A Trust Deed allows you to make an affordable monthly repayment towards your debts for a set period of time, typically four years. So long as you successfully meet all your payments, your Trust Deed will end and all remaining debt will be written off.

What are the set-up fees?

All fees incurred throughout the setting up of your Trust Deed will be covered by the monthly payments you make. You should not have to pay fees or charges up-front.

How does it affect my assets?

Once your Trust Deed becomes protected, you have to transfer any property you own to your Trustee who will decide what action will be taken with it. Bear in mind it is your Trustee’s responsibility to recoup as much money for your creditors as possible. This could involve you having to sell or re-mortgage your property at the end of your Trust Deed.

What are the on-going costs, and how long will this go on for?

You will need to make a payment each month for a period of four years. This amount needs to be balanced between a payment you can afford to maintain, and also one which your creditors are happy to accept. While four years is the typical period, it may be possible to reduce this term if you can repay creditors earlier. Conversely the term may be extended if you fail to meet all of your obligations.

There are fees involved with the administration of a Trust Deed, but these will be taken out of your monthly payments.


With multiple options available, it is imperative that you speak with a professional before making any rash decisions as to your financial future. Getting good advice is vital in ensuring you deal with your debt in the best possible way.

If you are considering a DAS, sequestration or a Trust Deed, then Scotland Debt Solutions can help. Contact any of our offices to find our more or to arrange a free and confidential consultation.

John Baird

Insolvency Adviser

Tel: 0800 063 9250

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