Protected Trust Deed
Provided you have maintained all of your Trust Deed payments, you will be free of all unsecured debts within 3 years.
Trust Deeds are voluntary agreements between you and your creditors (the people you owe money to). You agreed to repay part of what you owe them. A trust deed will normally include a contribution out of your income for a specified period; this is usually 3 years but can vary.
Each case is individually assessed, much in the same way as with an IVA in England or Wales. As such, you may qualify with £6,000 or more debt from 2 or more creditors.
What are the benefits of a Trust Deed?
A Trust Deed will:
- Consolidate all your unsecured debt into one monthly payment
- Have a fixed term, usually 3 years
- Write off all your remaining unsecured debt at the end of the term
- Stop creditors from calling and sending letters to you
- Prevent you from being made bankrupt / sequestration
- Allow you to continue to run any Ltd company that you may be running
- Reduce your monthly outgoings in line with your income and expenditure
Who is eligible for a trust deed?
Trust Deeds are available to all individuals, sole traders and business partners, domicile in Scotland who are insolvent and experiencing unaffordable debt repayment problems.
Domicile: An individual can be resident in more than one country at the same time, but can be domiciled in only one. Domicile can involve complex issues of law, but it is normally considered to be where a person’s permanent home is located.
If you have left the UK or Scotland, but have lived in Scotland during the previous 12 months, you are still eligible for a Trust Deed.
Insolvent: To be insolvent you need to have debts your are unable to pay as they fall due, and importantly, your debts also outweigh your assets. You are not insolvent if your have debts of £30,000 but have assets (such as equity in property) of greater value.