Trust Deed | Scotland | Sole Trader Debt
What is a Trust Deed? | Sole Trader
A Trust Deed is a formal debt solution created for residents of Scotland. It is sometimes known as an alternative to the IVA which is not available in Scotland, whereby you agree to pay back a portion of the debts that you owe.
The Trust Deed is set up between you and your creditors through a Licensed Insolvency Practitioner. You pay back a portion of your debts via monthly payments that you can afford. This would generally consist of 36 affordable monthly payments. At the end of the 36 months any remaining debt that you owe is written off and you become debt free. This is all outlined at the beginning of the agreement, so you will know what quantity of the debt you are paying back and what quantity of the debt is going to be cleared.
How does a Sole Trader set up a Trust Deed?
If you live in Scotland and you are struggling to pay your unsecured debts then a Trust Deed might be an appropriate Debt Solution for you. You would normally need debts in excess of £12,000 with atleast two creditors.
When we speak to you we will do an analysis of your debts, your monthly income and your monthly outgoings (i.e. bills, rent, mortgage, food, fuel etc). This enables us to determine whether or not a Trust Deed is the best debt solution for your circumstances.
If a Trust Deed is your best option and you want to proceed, we will draft a proposal for your creditors with the input of our Licensed Insolvency Practitioners. The proposal will detail your proposed monthly payment to your creditors, the amount of debt you propose to pay and the percentage that will be written off. Once your creditors agree to the proposal, your Trust Deed will become protected and legally binding. This means your creditors can not opt out or hassle you for debts within the agreement.
Advantages of a Trust Deed for a Sole Trader
- Only pay back the debts you can afford.
- You will be debt free in 36 months.
- The remainder of your debt after the 36 months will be written off.
- Your interests & charges are frozen & stopped immediately when your Trust Deed becomes Protected.
- You will not have to deal with your creditors. They will have to deal with any queries or correspondance with us.
- It can be an effective alternative to Sequestration (Scottish term for Bankruptcy).
- An Trust Deed is suitable for indivduals, couples, families, businesses etc...
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