Can You Get a Mortgage with a Debt Arrangement Scheme?

A Debt Arrangement Scheme (DAS) can provide essential breathing space when repaying debt, but many borrowers worry about its impact when applying for a mortgage in the future. The good news is that you can get a mortgage with a Debt Arrangement Scheme, depending on when it was completed, how it appears on your credit file and your recent financial behaviour.

This guide explains how lenders view DAS arrangements, what your options are, and how to strengthen your application. This article provides general information only and does not offer regulated mortgage advice.

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What Is a Debt Arrangement Scheme (DAS)?

A DAS is a Scottish Government-backed debt repayment plan that allows you to repay debt over a longer period with protection from further interest, charges or enforcement. Once approved, all included debts become part of a Debt Payment Programme (DPP).

When applying for a mortgage, lenders will pay attention to:

• Whether the DAS is active or completed
• Whether debts were repaid in full
• Your bank statement conduct during and after the DAS
• How your credit file reflects the arrangement

A DAS is not the same as insolvency, but it does impact your credit profile while active and for a period after completion.

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Can You Get a Mortgage While a DAS Is Active?

In most cases, mainstream lenders will not approve a mortgage during an active DAS. This is because:

• Disposable income is heavily restricted
• The arrangement indicates past financial difficulty
• Affordability usually fails due to ongoing repayments

However, some specialist lenders may consider applications in situations where:

• The applicant has strong, stable income
• The deposit is substantial (e.g., 20%–30% or higher)
• Recent financial conduct is excellent
• The DAS is nearing completion

Expect more detailed underwriting and stricter affordability checks.

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Can You Get a Mortgage After Completing a DAS?

Yes — this is far more common.
Your chances improve significantly once the DAS has been completed and recorded as such.

Lenders typically assess:

1. Time Since Completion

Most lenders prefer at least 12 months of clean conduct after completing a DAS, though some specialist lenders may consider cases sooner.

2. Whether All Accounts Are Marked Correctly

Credit files should show:

• Debts as “settled,” “satisfied,” or “partially settled”
• No remaining active DPP markers

Accuracy matters, as incorrect data can delay or damage approval prospects.

3. Recent Payment Behaviour

Underwriters look closely at your last 6–12 months of:

• Direct debit reliability
• Bank statement stability
• Consistent budgeting
• No new adverse credit

4. Deposit Size

The larger the deposit, the more options you generally have:

• 5–10% deposit: limited options
• 10–15% deposit: more specialist lenders available
• 20–25% deposit: wider acceptance, even with recent financial recovery

5. Income and Employment Stability

Stable employment and predictable income patterns strengthen an application significantly.

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How a DAS Appears on Your Credit File

A DAS itself is not a single credit marker, but the debts within it typically show:

• Arrears or defaults (if present before entry)
• Arrangement markers
• Payment plans
• Settled or partially settled status after completion

These remain for six years from the original date of the adverse event, not the end of the DAS.

So it’s possible for your credit file to recover sooner than expected, especially if the debts were already old when entering the scheme.

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Steps to Improve Your Mortgage Chances After a DAS

(General Information Only)

1. Maintain Perfect Payment Conduct

The most recent 6–12 months of financial behaviour are critical.

2. Reduce Credit Utilisation

Keeping credit card balances low helps demonstrate responsible credit use.

3. Avoid New Borrowing

New commitments can reduce affordability and raise lender concern.

4. Ensure Credit Reports Are Accurate

Check all three agencies and dispute incorrect entries.

5. Build a Strong Deposit

A larger deposit reduces risk and widens lender choice.

6. Prepare Explanations for Underwriters

A short, factual explanation of your DAS can help underwriters make sense of your financial history.

7. Improve Bank Statement Conduct

Keep spending controlled, avoid unarranged overdrafts and ensure all bills are paid by direct debit.

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Common Scenarios and How Lenders Respond

Scenario 1: DAS completed over 12 months ago with clean conduct since

This is the most favourable scenario, offering wider lender choice.

Scenario 2: DAS recently completed but all debts settled

Some specialist lenders may consider this, especially with a larger deposit.

Scenario 3: DAS still active

Options are limited but not always impossible — strong income and deposit support are usually needed.

Scenario 4: DAS debts include historic defaults

Lenders may overlook older defaults if the DAS is complete and conduct since has improved.

Scenario 5: DAS completed but new credit has been taken out

Underwriters will check whether borrowing is affordable and well managed.

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Summary

Getting a mortgage with a Debt Arrangement Scheme is possible, particularly after completion and with strong recent financial conduct. Lenders focus on:

• Whether the DAS is active or completed
• Deposit size
• Time since completion
• Bank statement behaviour
• Credit report accuracy
• Income stability

Many borrowers successfully secure mortgages after completing a DAS, especially when they can demonstrate financial recovery and responsible ongoing credit management.

This article provides general information only. For personalised guidance, regulated mortgage advice is required.