Rent and mortgage arrears on your sole or main residence can be left out of a programme altogether. What is left out is not protected by it.

Here is what the scheme does to your home, what it does to your other belongings, and where the protection stops. Our guide to how the Debt Arrangement Scheme works covers the scheme itself.

No. Nothing is handed to a trustee, because a programme is a way of repaying your debts in full rather than a form of insolvency.

What approval actually does

Once a programme is approved, section 4 of the Debt Arrangement and Attachment (Scotland) Act 2002 makes it incompetent to serve a charge for payment, to commence or execute any diligence for the debts in it, or to found on one of those debts in petitioning for your sequestration.

Regulation 34(1) adds that no order granting warrant for sale of attached land can be made, and no satisfaction order. Approval also recalls any arrestment of your income or property.

A Debt Payment Programme is not an insolvency solution. You repay the debt in full, and what changes is the pressure rather than the balance.

The fear this question comes from

Most people asking it have had a letter with the word diligence in it. Diligence is enforcement, and enforcement is what a programme is designed to switch off.

What it is not designed to do is take things from you. There is no trustee and no estate to administer.

Why that framing matters

Sequestration and a protected trust deed both involve your estate passing to a trustee. A Debt Payment Programme does not, which the scheme against sequestration for a homeowner compares in detail.

A condition can require an asset to be realised, but not your home. Regulation 28(3)(a) makes a dwellinghouse or mobile home occupied as your sole or main residence an excepted asset.

Excepted and not excepted

The one exception runs your way rather than against you. Since 29 October 2018 regulation 28(4) lets a debtor choose to have that condition attached, at their own option.

What a condition is for

Conditions exist so that the DAS Administrator has a middle course between approving a proposal as it stands and refusing it. They are not a mechanism for stripping assets.

The value of any land you own above the sum secured over it is one of the matters weighed on approval. The fair and reasonable test sets out all twelve.

The ongoing payment stays with you. Arrears on your sole or main residence can go into the programme or be left out of it, and that choice is yours under regulation 20(2AA).

In or out

That exclusion was inserted by the Debt Arrangement Scheme (Scotland) Amendment Regulations 2018 and applies where the debtor is an individual and the debt relates to their sole or main residence.

The consequence of leaving arrears out

A debt outside the programme is a debt the programme does not protect. It stays owed on its own terms to the lender or the landlord.

So excluding arrears is a decision to handle them separately rather than a way of parking them. Whether rent or mortgage arrears can go in sets out both sides of that choice.

If they go in

They are then debts in the programme, so the interest freeze and the protection against diligence apply to them like any other included debt. Your ongoing payment still has to be met.

Paying a continuing liability when it falls due is a standard condition, and which debts can and cannot go in covers the rest of the dividing line.

It stops the things the statute names, and it is important to be precise about what those are. A charge for payment and diligence for the debts in the programme become incompetent, and no creditor can petition for your sequestration on one of them.

Where the protection is clear

• Diligence to enforce a debt in the programme, which is where an arrestment or an attachment would sit.
• A warrant for sale of attached land, and a satisfaction order, under regulation 34(1).
• A creditor petition for sequestration founded on a debt in the programme.
• The release of funds already arrested at your bank, which regulation 34(2) blocks while the programme is approved.

Where it is not

A secured lender’s remedies over the security itself are not addressed by these provisions, and arrears excluded under regulation 20(2AA) are not in the programme at all.

Anyone facing court action about their home should get advice the same week rather than rely on a general statement about diligence. Take the paperwork to a money adviser.

Two questions nobody can answer flatly

Inhibition is not named anywhere in the recall provisions, and no source settles whether one already registered is recalled on approval. Ask your money adviser what applies to yours.

What is prohibited is a charge for payment and the commencing or executing of diligence. Whether a creditor may still raise an action is not settled by any source.

The statutory moratorium, before the programme is approved

A statutory moratorium lasts six months. The period was six weeks until section 23(2) of the Coronavirus (Recovery and Reform) (Scotland) Act 2022 substituted six months in section 198 of the Bankruptcy (Scotland) Act 2016, with effect from 1 October 2022.

The Accountant in Bankruptcy’s guidance warns that protection is lost if no application is made before the six months ends, and how a moratorium protects you covers what it reaches.

No. Owning property is a factor in the decision rather than a bar, and there is no minimum or maximum debt for a programme.

How equity is treated

Regulation 25(2)(c) asks the DAS Administrator to look at the amount by which the value of any land you own exceeds the part of your debt secured over it. It is one factor among twelve.

That is a long way from the position in an insolvency, where the trustee deals with your interest in the property. Here the equity informs a decision about a repayment plan.

Why homeowners often end up here

A programme repays the debt in full and leaves the house alone, which is the trade many homeowners want to make. Choosing between the scheme and a trust deed sets the alternatives out.

The trade-offs are real and worth reading. The disadvantages of a Debt Arrangement Scheme covers them.

They stay yours. Nothing passes to anyone, and the assets a condition cannot touch include anything exempt from attachment under section 11 of the 2002 Act.

The vehicle figure, and the one it is confused with

Section 11 of the Debt Arrangement and Attachment (Scotland) Act 2002 exempts a vehicle the debtor reasonably requires and which does not exceed £1,000 in value.

The £3,000 vehicle figure that appears on many Scottish debt pages is the disregard in section 2(3)(b) of the Bankruptcy (Scotland) Act 2016, which applies inside the Minimal Asset Process asset calculation and nowhere else.

It is not an eligibility figure and it does not travel. Reading it across to the Debt Arrangement Scheme, or to a trust deed, gets the number wrong by £2,000.

Why nothing is handed over

The scheme works by rescheduling payments, not by realising what you own. That is the whole difference between it and an insolvency solution.

The only asset mechanism in it is a discretionary condition, and that has its own list of exceptions.

What a creditor cannot do

Attachment is diligence, so it is caught by the general prohibition once a programme is approved. What survives approval is narrow and specific.

Whether a Debt Arrangement Scheme stops a bank arrestment goes through each creditor power and where it stands.

On the home question the difference is structural. A Debt Payment Programme leaves your estate with you, and both insolvency routes do not.

Side by side

Whether you lose your home in a trust deed deals with the insolvency side of that, where the answer is more complicated.

What to weigh

A programme repays everything you owe, which takes years, and it is a public entry on the DAS Register while it runs. An insolvency solution is shorter and writes off what is left, at a cost to your estate.

Borrowing during the programme is also restricted, which getting a mortgage during a programme explains, and our Debt Arrangement Scheme page sets out how we help.