Is a Trust Deed a good idea?
Trust Deeds provide the means for many people to manage their debts in Scotland. Without this type of debt solutions, a lot of people would be faced with fluctuating repayments and added strain on their finances.
How does a Trust Deed work?
The process typically entails a review of your finances with an Insolvency Practitioner, who will go through the details before presenting an estimated monthly payment. You would then agree to that figure and allow the Insolvency Practitioner to act on your behalf. They will make a proposal to your creditors, who will have to accept or reject it within five weeks of correspondence. Once a majority of creditors agrees to the proposal, the deed is registered and enacted.
If there is no response in the given time, it is assumed the deed can go ahead. When the deed starts, you are protected.
Are Trust Deeds only available in Scotland?
Yes. Elsewhere in the UK, an appropriate equivalent would be taking an Individual Voluntary Agreement. To qualify for a Trust Deed in Scotland, an individual would have to have lived in the country for at least six months, while also having over £5,000 in debt which needs to be repaid.