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What is a Debt Settlement Arrangement?

A Debt Settlement Arrangement (DSA) is an insolvency solution set up by the Insolvency Service of Ireland (ISI) which is suitable for people struggling to repay debts of more than €20,000 to one or more creditors.

It covers ‘unsecured debt’ such as credit cards, loans, bank overdrafts and store cards. Unlike a Personal Insolvency Arrangement, it does not include ‘secured debt’ such as a mortgage on your house or on a buy-to-let property.

It provides peace of mind as it prevents creditors from contacting you directly - all communication is handled by your Personal Insolvency Practitioner. A DSA normally lasts up to five years and at the end you can start afresh as you will be discharged from all debts covered by the DSA.

You only have to make one affordable monthly payment via your PIP and you are guaranteed a reasonable standard of living for you and your family while you resolve your debt problems. You will have a monthly allowance for food, clothing, utility and communication bills, transport, education, health care, childcare and even an allowance for savings and contingencies.


Key features-at-a-glance

  • agreed settlement of unsecured debt owed to one or more creditors
  • no limit on value of debt involved
  • minimum unsecured debt of €20,000
  • requires agreement of creditors representing 65% of your total debt
  • all debts covered by DSA discharged at end of scheme
  • must apply via a Personal Insolvency Practitioner (PIP)

In this Guide

How does a Debt Settlement Arrangement work? 

Step one - Consult a PIP and collate all your financial details

Gather your financial information together and arrange a meeting or phone call with a Personal Insolvency Practitioner who will be able to make an expert assessment of your situation and advise you on whether a DSA is the best solution for you or whether you should look at other options. Your PIP will help you to complete a Prescribed Financial Statement - this is a document which provides a comprehensive account of your financial situation - how much you owe and to how many creditors, and also your assets, income and expenditure. Your PIP will also provide you with written details of all fees, arrangements and costs involved in entering a PIA. You must consent to the ISI obtaining and disclosing relevant personal data. 

Step Two - PIP applies for court protection to prevent creditors contacting you

Your PIP begins the official process by applying to a court for a Protective Certificate. Once this has been granted, you get immediate protection from creditors which means they are prohibited from any further contact with you - so no more letters, calls or visits about unpaid debts. There is a legal standstill period of 70 days during which your PIP gets on with drafting a repayment proposal for creditors on your behalf. Your PIP will ensure you are kept informed of progress and consulted throughout this period. 

Step Three - PIP negotiates with creditors to secure a repayment agreement

Your PIP will present the repayment proposal to all your creditors and negotiate with them on your behalf in order to secure their support for your DSA application. You must secure support from creditors representing 65% of your debts in terms of value for your application to succeed. Statistics from the Insolvency Service of Ireland show that creditors are generally willing to strike deals, with acceptance rates for DSAs currently running at 80%. Your PIP will ensure you are kept informed of progress and consulted throughout this period.

Step Four - Your application gets court approval and becomes legally binding

Once creditors representing at least 65% of your debts have approved the terms of the repayment proposal, the DSA application will be submitted for court approval. After receiving court approval, the DSA officially begins and your creditors are prevented from making direct contact with you for the duration of the DSA (normally five years but can be extended to six). The ISI enters your details on a Public Register of DSAs.

Step Five - You are discharged from all debt covered by the DSA after 5 years

At the end of the period, as long as you have complied with the DSA, you will be discharged from all debts included in the DSA. The duration of the DSA is normally up to five years but can be extended to six years. It can be less than five years depending on the proposal agreed by creditors. Your details will be removed from the Public Register. You will be solvent and can make a fresh start.

Why should I consider a Debt Settlement Arrangement? 

  • you are struggling or unable to repay unsecured debt such as credit cards, loans, overdrafts
  • you are being constantly chased by creditors for debts you cannot afford to repay
  • you and your family have barely enough to subsist on after paying bills and debts
  • you want a debt solution that allows you to make a fresh financial start
  • a Personal Insolvency Practitioner can guide you through the entire process
  • ISI data shows creditor acceptance levels of 80% for DSAs


Advantages of a Debt Settlement Arrangement 

  • you will be protected from creditors pursuing you for unpaid debt
  • you will only have to make single affordable monthly debt payments
  • the Insolvency Service of Ireland has waived application fees until the end of 2015
  • you will only repay a percentage of your debts rather than having to repay them in full
  • you and your family will be guaranteed a reasonable standard of living
  • creditors will write off all remaining unsecured debt in the DSA when it concludes 

Disadvantages of a Debt Settlement Arrangement 

  • An application can only be made through a Personal Insolvency Practitioner
  • It is a legally binding agreement which must be operated in accordance with regulations set out by the Insolvency Service of Ireland
  • Your name and address will be entered on a public register - however access is limited and your details will be removed when the scheme ends
  • It will impact adversely on your credit rating - however, it demonstrates to future lenders that you have acted responsibly to resolve your debt

For friendly advice on the right debt solution for you, please contact us on 01 905 3150.

Frequently Asked Questions

No, mortgage debt is classed as ‘secured’ debt - the DSA covers only unsecured debt such as credit cards, overdrafts and personal loans.

No, a DSA is a personal debt solution so you cannot include business debt of any kind.

No, there is no financial limit on how much unsecured debt can be covered by a DSA.

The ISI has established clear guidelines that guarantee that people applying for a DSA will have a reasonable standard of living for themselves and for their families for the duration of the DSA.  You will receive a monthly living allowance that takes into account your personal circumstances and includes money for food, clothing, utility and communication bills, transport, education, health care, childcare and even a modest allowance for savings and contingencies.

No, how you choose to spend your monthly allowance is up to you. You are in control of that money and you do not have to account for every penny or submit receipts.

The house you live in is classed as your ‘principal private residence’ - if you have a mortgage on it, this is secured debt and not covered by the DSA, so you should not have to move out or sell it. However if the monthly payments are particularly high, you may wish to discuss with your PIP whether it is best to remain there.

If you need a car for work, the DSA does not require you to sell it. However, if you have an expensive car, your PIP may discuss replacing it with a cheaper model.

Your pension fund should be excluded from a DSA if is deemed to be a ‘relevant pension arrangement.’ However if you are receiving monthly pension income or about to receive a pension lump sum, this will be treated as an asset and some of that money may have to be paid to creditors. We can advise you on your own situation.

Yes, you cannot include secured debts such as mortgages, nor can you include family maintenance payments under court orders or court fines related to criminal offences.

It can last for any period up to five years, depending on your particular circumstances. It can in some instances be extended to six years.

There is no guarantee when you apply for a DSA that your creditors will agree to the terms proposed on your behalf by your PIP. However, you do not need to secure 100% backing - you just need the support of a minimum of 65% of your creditors. Your PIP will handle all negotiations with creditors. Data from the Insolvency Service of Ireland shows a very high acceptance rate by creditors for DSA applications - it is currently running at 80% of all applications. For creditors, the attraction of a DSA is that it provides a guarantee that they will receive a certain portion of the money they are owed.

No, it will be removed when the DSA expires and even during the course of the DSA, only limited details are entered on the Public Register. We can tell you more about that.

You will have a fresh start once the DSA expires as all of the unsecured debt covered by the DSA will be completely written off. You will be solvent and in a better financial position than if you had not tackled these debts. However banks and other lenders will make their own lending decisions based on a complete picture of your financial record and credit score at the time of application.

No, you can only apply for one of these schemes at a time and you cannot apply if you are currently bankrupt or have been discharged from bankruptcy in the last five years.

If you don’t keep up payments and you are in arrears for three months, either a creditor or your PIP may apply to court to have the DSA terminated. A DSA is considered to have failed if you are in arrears for six months. When a DSA fails you will no longer be protected from any legal action by creditors and you will be liable for outstanding debt.

Carrington Dean

Unit 3 Hays House
High Street
Dublin 24

(01) 905 3150

Opening Hours

Mon: 9:00am - 8:00pm
Tues: 9:00am - 5:00pm
Wed: 9:00am - 8:00pm
Thu: 9:00am - 5:00pm
Fri: 9:00am - 5:00pm
Sat: Closed
Sun: Closed

© 2017 Carrington Dean (Ireland). All rights reserved.

Carrington Dean (Ireland) Limited is a Limited Company registered in Ireland, registered number 537533

Registered office - Unit 3 Hays House High Street Tallaght , Dublin 24

Peter Dean of Carrington Dean Ireland is authorised by the Insolvency Service of Ireland to carry on practice as a personal insolvency practitioner. Peter Dean is also authorised to act as an insolvency practitioner by Institute of Chartered Accountants in England and Wales.