Scottish Trust Deeds
What is a Trust Deed and how can it help me?
A Trust Deed is a government approved debt solution available to Scottish residents. A Trust Deed is a voluntary arrangement to pay your unsecured debts which transfers your rights to your assets (things you own) to a trustee who will sell these to pay your creditors. In addition you will be required to pay monthly payments into your trust deed for a fixed period usually around four years.
There are two types of trust deed. The first is a protected one which means the majority of your creditors have agreed to its terms. A Protected Trust Deed prohibits creditors from taking any further action against you and they must freeze your debts. An unprotected or ordinary trust deed is one which a certain proportion of your creditors have objected to the terms of the deed. In an ordinary trust deed your creditors may still decide to pursue you for the money you owe and can still take legal action against you.
Pros and cons of Trust Deeds
Trust Deeds: A Debt solution for Scottish residents
- Write off all the debt you can't afford to repay
- Prevent or stop legal action including sequestration
- Be debt free in 4 years (in most cases)
- Your credit rating will be affected for 6 years in total
- Legal action can only be prevented if your Trust Deed becomes protected
- Unless your mortgage company agrees to exclude your house from the trust deed it will be sold by the trustee to pay your debts
The Trust Deed Application Process
Spend 60 seconds filling in the form
Filling in our short form so we can refer you to our trusted business partner, Immediate Financial, to get an idea of your situation and give you advice tailored to you personally. Filling in the form is quick and easy and requires no obligation on your part.
Immediate Financial will provide you with advice on whether a Trust Deed is the best solution for you
Once you’ve filled in our short form and we’ve got the necessary information, they can provide you with advice relating to a Trust Deed. They’ll look at your situation and help you decide if a Trust Deed is the best solution... If not they may suggest an alternative debt plan such as debt management.
Should you decide to enter into a Trust Deed Money Expert will negotiate a Trust Deed plan suited to what you can afford to pay
If you decide, based on their advice, that applying for a Trust Deed is right for you, then they will work out with you a monthly payment that is within your means and contributes a sufficient amount towards your outstanding debts. They will then submit all the paperwork required for a proposal to our approved Trust Deed Company in order to negotiate payments with your creditors. We will be attempting to make sure that the Trust Deed is protected at this point.
You will enter into a trust deed plan according to a monthly amount that you can afford, at the end of the agreed period any remaining debt will be written off
From here your Trust Deed will officially begin, and usually for the next three years you will pay the agreed sum every month to a trustee at our approved Trust Deed Company who will then distribute it amongst your creditors.
Once the four year period is over, the Trust Deed ends and any remaining debt is written off.
About Trust Deeds
How do i apply?
To find out more with no obligation simply complete the quick online form and talk with a debt specialist in minutes for free advice on how to manage your debt today. By completing this request you are under no obligation to enter into a Trust Deed and the debt specialist may recommend other options to you. Apply for debt help now
Alternatively you can call free on 0800 298 0033 for a confidential chat one of our advisors about what's right for you.
Is a Trust Deed right for me?
If you are looking for a solution to multiple credit card debts and/or loans which you either can’t or soon won’t be able to afford to pay then a Trust Deed could be right for you.
A Trust Deed is a form of insolvency which if you qualify for it may be a preferable option to sequestration (bankruptcy). This is because you may have the option to keep your house if your mortgage provider agrees you can keep this out of the deed.
However since this is a form of insolvency it will affect your credit rating and may also prohibit you from entering certain professions or from keeping an existing job in certain sectors of the market. You will also be placed on the Trust Deed Register and this will be advertised in the Edinburgh Gazette.
What are the requirements for entering a Trust Deed?
You should be a Scottish Resident. You should have minimum debt of £5000 owed to two or more creditors. In addition you should have disposable income of around £170 per month or £40 per week.
What are the fees for entering into a Trust Deed and what are these for?
There are no set up fees when you apply for a Trust Deed through Money Expert. Immediate Financial will prepare a financial statement, gather information from your creditors, provide a courier to pick up your documents and prepare your file to submit to our trusted business partner, our approved Trust Deed company. Should the Trust Deed proposal fail or fail to become protected then we would look into other options for you.
There will also be ongoing charges when your Trust Deed is in place, which are paid as a proportion of your monthly payment into the Trust Deed. These are not additional payments but are for the Trustee for the day to day running of the plan.
Frequently Asked Questions
Can I sign a Trust Deed if I am a director of a company?
You should note that if you are a director of a company you will not be allowed to sign a Trust Deed. There are also some professions such as in the financial services or armed services where signing a Trust Deed could affect your job. You should refer to your terms of employment or speak to your employer prior to considering this option.
Will I keep my car in a Trust Deed?
This will depend on the value of your vehicle and whether it is required for travelling to work on a regular basis. If you have a high value car the trustee may order you to sell it and downsize to a more economic model or to use alternative transport.
What debt can I include in a Trust Deed?
Any unsecured personal debt can be included. However you may not include debts to family members. Examples on personal unsecured debts would be credit cards, pay day loans, personal loans and overdrafts.
I have a hire purchase debt for my car. Can I include it?
Hire purchase debts can’t be included in a Trust Deed unless the item the loan was secured on has been returned or seized and you only have a shortfall left to pay. Similarly a mortgage shortfall, where you have lost your property but still owe part of the mortgage can be included.
What happens if my circumstances change?
If your circumstances change you must inform the Trustee immediately so they can decide if the Trust Deed can continue at the level of payment you are now able to make. If you are fired or if you get a pay rise you must inform the Trustee and the payments you make will need to change accordingly. If you fail to make the agreed payments you run the risk of the Trust Deed failing.
Do all of my possessions need to be sold?
No you are allowed to keep certain items such as household appliances and children's toys. Other items are at the discretion of the Trustee. In general the idea is for you to have a manageable standard of living. Similarly your house can be excluded from the trust deed if your mortgage company agrees.
I have a debt where diligence has already been taken against me. Can I include it?
This is up to the creditor. A lot of the time they will not permit you to include this. In the case of Council Tax which has gone to a Sheriff they may stop the diligence and allow you to include it.
Apart from secured debts are there any other debts I can’t include?
Yes you are not permitted to include fines, debts to family members or any item pertaining to fraud such as benefit overpayments. This list is not exhaustive and our advisors are best placed to look at your debts and advise which ones can go in.
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- Clear your debts without the need for a loan
- Have one affordable monthly payment
- Reduce demands from your creditors
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