Debts Scotland & Trust Deeds

Scottish residents have an option other than sequestration (bankruptcy) to help them in dealing with their debts scotland problems. This scottish only option is known as a trust deed.

This would be a formal agreement made with a consumer's debtors. A trust deed is appropriate for anyone with scottish debt, usually above £10000. A deed would be granted to a trustee by the debtor. A trustee is usually signed by a qualified insolvency practitioner. The trustee would then be transferred the assets of the debtor. The trustee would then act on behalf of the debtor. Debtors feel that they have more control over their complete debts in scotland with this type of arrangement. Trust deeds usually cost much less than other options. They also provide the debtor with some flexibility.

It does not alter any existing arrestments that may apply to the debtor. Debtors who own their own home may still be forced to sell, especially if creditors cannot be paid from other sources of the debtor's income. Also, trust deeds are non-reversible. Once a debtor and a trustee enter into a trust deed, it is legally binding. The trust deed may not be abolished. Before seeking sequestration, debtors should explore the possibility of entering into a trust deed to solve their financial problems.

Trust deeds, if meeting certain criteria, may be recorded in the Registrar of Insolvencies as a protected trust deed. This means creditors are prevented from forcing/ applying pressure on the debtor. Of course, the debtor must adhere to the terms of the trust in order for the deed to remain protected. If a debtor does not observe the guidelines of a protected trust deed then the protection would be terminated.