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This is the place to ask questions about DAS
By BennyT
#22923
Can you tell me if there is a maximum amount of debt beyond which you would not be eligable for a DAS? We owe c£220k including the mortgage and wondered if this would mean that we have too much debt to start a debt arrangement scheme.
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By Hayden
#22935
Hi there BennyT

I do not think there is a maximum debt for a Debt Arrangement Scheme (DAS). However you need to understand that only unsecured debts can be included in the arrangement. As such your mortgage would not be included and you have to keep paying this as normal unless you want your house to be repossessed. How much unsecured debt do you have?
By BennyT
#22941
Thanks. That makes things a bit clearer. However this leaves us with another problem. Our mortgage is £190,000 which leave unsecured debts of £30k. If we continue to pay the mortgage then that will only leave around £120 a month for the other debts. Will this be enough to make the debt scheme work?
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By Steve Jackson
#22977
Hello BennyT

You can certainly start a Debt Arrangement Scheme based on payments of £120 a month. However bear in mind that you need to pay 100% of your unsecured debt using a DAS. As such if you have unsecured debts of £30k they are going to take a very long time to pay. Have you considered the alternative Trust Deed solution? You might be able to successfully use this to get out of debt far faster. However whether a Trust Deed is appropriate for you or not might well depend on whether you have any equity in your property. Do you know whether this is the case?
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By Amy Jellings
#23100
Hi BennyT.

In reality you may find it impossible to find an advisor that would be happy to set up a debt arrangement scheme for £120 per month on £30000 of debts.

If the repayment term is much more than ten years it may appear to the advisor and the creditors that DAS is unsuitable.
By BennyT
#23135
Many thanks for your replies. Our house is currently in negative equity but we want to stay in the property if at all possible. Your suggestion of a Trust Deed might be the right one but does it matter that there is no equity in the property? How would this work?
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By Hayden
#23165
Hi BennyT

You do not have to have any equity in your home to be eligable for a Trust Deed. In fact this might work in your favour as it will mean that you are not required to raise any funds from your property as part of the agreement. I suggest you chat your situation through with a debt advisor so they can double check whether the trust deed is for you. Why not talk to one of the experts at BeatMyDebt.com about this.
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By Steve Jackson
#23391
Hayden is correct BennyT, igt is not necessary to have equity in your property to start a Trust Deed. If the property is in negative equity it simply means that you will not have to release equity as part of the agreement as there is non. Do follow Hayden's advice and chat through your situation and all your options with a debt expert and this will help make things much clearer.