Composition
The DAS administrator, with the client’s consent, can make an offer of composition to each creditor after 12 years from the date of approval of the DPP and where 70 per cent of the total debt due in the DPP has been paid.1Reg 15 DAS(S) Regs The 12 years must not include any periods where the client was on an approved payment break. If all creditors agree, the DPP will be completed. If not all agree, the DPP duration may be reduced. A creditor who accepts the offer agrees that the client’s liability to repay that debt is discharged. A creditor who does not respond to the offer within 21 days is deemed to have accepted the offer.
If all creditors accept (or are deemed to have accepted) the offer, the DAS administrator sends written notification of the completion of the DPP to:
•the client;
•any continuing debt adviser;
•the payments distributor;
•the employer, where DPP payments are being made directly from the client’s pay;
•the creditors in the DPP.
The DAS administrator keeps a record of creditor acceptances. If the offer of composition is not accepted by all creditors, the DAS administrator must vary the DPP to remove the debts owed to the creditors who accepted the offer, or who are deemed to have accepted.
The DAS administrator sends written notification of the effect of the variation to:
•the client;
•any continuing debt adviser;
•the payments distributor;
•all creditors continuing to take part in the programme;
•the employer, where DPP payments are being made directly from the client’s pay.
Note: the AiB has been advised by the creditor sector that debts included in a DPP which is completed using composition under the regulations will be recorded with the credit reference agencies as ‘partially settled’. Any queries on this point should be directed to creditors or the credit reference agencies.