The request to creditors to consent to the DPP application
The DAS administrator issues, via eDEN (if the creditor is registered) or mail, a request to consent to the DPP application to each creditor. All letters will be sent on the same day that the DPP is proposed to creditors using eDEN.
Creditors have 21 days from this date to respond to the proposal. This becomes the relevant date on which the application is made.
All interest, fees, penalties or other charges are frozen from the date the application is recorded on the DAS Register, and the request to creditors to consent is issued. They remain frozen until the DPP application is rejected, or an approved DPP is completed or revoked.
The request to consent gives creditors all the information they need to make a decision to accept or reject the proposed DPP application. It extracts information from the application form to give as much information as possible so that creditors can correctly identify the debt and understand the payment proposal being offered.
The form states:
•the client’s details (name, address, postcode and date of birth);
•the client’s financial statement;
•how much of the client’s surplus income will be offered as a contribution to the DPP (if the client does not wish to use the full surplus);
•any rent or mortgage arrears which have not been included in the DPP;
•details of the joint client, if applicable;
•the total amount the client owes the creditor;
•the percentage of the total debt owed that will be repaid by the client after the fees have been deducted (net amount of debt);
•sort codes, account numbers and reference numbers (if known);
•the amount the creditor will receive in each instalment;
•the frequency of the proposed payments to the creditor;
•the proposed length of the DPP, any lump sum payments or realisation of assets.
Creditors must respond within 21 days from the date of the request. If they do not, they are deemed to have consented to the DPP terms (this does not apply if the DPP is only for a single debt).1Reg 23 DAS(S) Regs There are three possible responses from each creditor:
•consent – the creditor responds within 21 days and agrees to the proposal;
•deemed consent – the creditor does not respond within 21 days. In this case, the creditor is deemed to have agreed to the proposal, unless the DPP is only for a single debt, where it will be treated as if the creditor has not consented.
•non-consent – the creditor responds within 21 days and does not agree to the proposal.
After 21 days, if at least 90 per cent in value of creditors have consented (or are deemed to have consented) to the DPP, the DAS administrator must approve the DPP automatically regardless of the amount of the debt or the length of the proposed programme. The DAS Register is updated to show the DPP approval date (‘original decision date’ and ‘DPP start date’) and that no ‘fair and reasonable test’ was carried out. However, single debt DPPs are subject to the ‘fair and reasonable test’, unless the sole creditor has actively consented to the DPP proposal.
Where at least 10 per cent in value of creditors object (or where the DPP is for a single debt and the creditor has not responded within 21 days), the DAS administrator must approve a DPP proposal that is fair and reasonable. The DAS administrator will consider all creditors’ responses and whether it is appropriate to approve the DPP. In deciding whether a programme is fair and reasonable, the DAS administrator considers the criteria set out under regulation 25.2Reg 25 DAS(S) Regs