Trust-Deeds

Posted by Mudassar Hassan on December 21st, 2017

It is designed to enable those who cannot repay their debts a way to establish, a monthly repayment schedule based on what the debtor can afford to pay. The Trust Deed will last for a specified period, usually three years. When the specified term of the arrangement comes to an end, any remaining debts are written off.

How does a Trust Deed work?

The Trust Deed will last for a specified period, usually three years. When the specified term of the arrangement comes to an end, any remaining debts are written off. Your protected trust deed is supervised by a licensed insolvency practitioner, who is responsible for all negotiations with your creditors and who is also responsible for ensuring that you keep to the terms of the Trust Deed.

Alternative Debt Solutions

Trust-deed-advice.com also offer Debt Management Programs. Debt management enables you to pay one single lower monthly payment to all your unsecured credit companies, taking away the stress and worry of day-to-day dealing with your creditors.

Once your creditors can see a regular pattern of monthly payments being paid to them by our company of Scotland and Co, they will be happy to deal directly with us and we will negotiate the freezing of charges and interest on your accounts

Advantages of a Protected Trust Deed

• The trustee handles all correspondence from creditors, therefore relieving the pressure of debt.
• A Protected Trust Deed is usually more flexible and costs less to administer than sequestration (bankruptcy).
• With a Protected Trust Deed, your creditors will be unable to add further interest, charges, or take any further action against you.
• You will in most cases still be able to hold certain public offices.
• You will in most cases still be able to remain self-employed and continue to serve as a director of a company.
• Protected Trust Deeds normally last 3 years, after which any remaining debt will effectively be written off.
• Information about the Protected Trust Deed is not published unlike sequestration (bankruptcy).

Disadvantages of a Trust Deed

• Existing arrestments and other diligence continue to be effective. It should be noted that Councils who carry out earnings arrestments will generally lift arrestments upon protection of the Trust Deed.
• You cannot be a company director of a limited company unless the company’s Article of Association state otherwise.
• The arrangement is binding on you as well as your creditors. If you were to default on the arrangement then the Insolvency Practitioner can petition for your Sequestration (bankruptcy)
• Entering into any arrangement with your creditors may affect your credit rating.
• Creditors are not obliged to accept a proposal for a Trust Deed. However, the Trustee will negotiate with all your creditors. Unless creditors, who are owed more than one third of the total debt object (which is extremely rare), the Trust Deed will become protected.