Clear your debts by making one affordable payment each month – and after 4 years, the rest of your unsecured debts will be written off, as long as you keep to the terms of your Trust Deed and make all your regular payments in full and on time.
What is a Trust Deed?
A Trust Deed is a debt solution uniquely available to Scottish residents.
In a Trust Deed, you pay one monthly payment – based on what you can afford – to your unsecured creditors, and after the agreed timescale (which is usually four years), your unsecured creditors will write off the rest of your debts.
Trust Deeds were introduced by the Bankruptcy Act in 1985 as an alternative to sequestration; they can be a preferable alternative, especially for homeowners and the self-employed, who might be able to avoid the sale of their home and keep their business trading.
Protected Trust Deeds are largely the same as normal Trust Deeds – the only difference is that the ‘protected’ status ensures that a creditor cannot take further legal action against you, nor can they file for your sequestration.
A Trust Deed can be a much faster way of becoming debt-free than with some other debt solutions but there are factors you should consider before option for a trust deed. For example, a trust deed will affect your credit rating – although if you’re struggling with your debts your credit rating might also be suffering.
For a detailed look at what a trust deed involves. visit our pros and cons page. Alternatively call us and we can discuss whether this debt solution might be right for you.
Is a Trust Deed right for me?
If you’re struggling to repay your debts, you live in Scotland, and you owe at least £5,000 to your unsecured creditors, you could qualify for a Trust Deed. A Trust Deed is a popular option for people with a large amount of debt because the write off nature of the solution allows them to become debt free quicker.
Trust deeds are a formal solution but monthly payments are based entirely on what you can afford. They will also affect your credit rating but if you are in debt and struggling to make your payments, your credit rating may also have been affected already. To get a better idea of whether a trust deed is a good fit for you, read our detailed guide of pros and cons.
If you’re looking for a debt solution, contact PayPlan today. When you call we will assess your financial situation and talk you through any relevant debt solutions to find the right one for your particular circumstances – whether that is a Trust Deed or something else.
We want you to regain control of your debts – and your life – so get in touch now and let us help you.
How it works
When you first call PayPlan, we will collect details of your finances and your debts. We will work out how much you can realistically afford to pay back to your unsecured creditors, and decide which is the best debt solution for you.
If a Trust Deed is right for you, we can refer you to our associated company PayPlan Scotland Limited, who will help you create a Trust Deed proposal for your creditors.
Your Trust Deed proposal will include details of your income & expenditure, and you will have to be able to provide proof of your income and any assets you have.
Once your Trust Deed proposal has been put together, it will be presented to your unsecured creditors who will vote on whether to accept it or not.
As long as no more than a half (in number) or a third (in value) of your unsecured creditors object to the proposal, your Trust Deed will become protected. It is then up to you to make your regular payments as agreed in the proposal.
If your Trust Deed isn’t approved, we may suggest you look at other debt solutions, for example a Debt Arrangement Scheme (DAS).
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