For many individuals, a protected trust deed is an excellent option. Scottish trust deeds have however been publicised heavily through various media. Naturally, individuals who are concerned about their debts may consequently be less aware of all the other possible alternatives to a Scottish trust deed. Frequently examining alternatives could lead to an improved outcome for the person in debt if justified by their needs and the specifics of the situation.
When exploring debt resolution options individuals in debt soon realise that there is a large selection. It is common for debtors to struggle when trying to understand the differences between all the avenues. It can be really stressful coming to a decision particularly since many want to have something in place as fast as possible, however, allowing yourself the opportunity to assess the pros and cons of each avenue will help you in the long term.
In this piece we’ll lay bare the debt advice stages used by good protected trust deed advisers. Understanding how they operate is a crucial part for any individual who wishes to take an active interest in the ways they resolve their financial imbalance. Readers ought to bear in mind that the information supplied is applicable solely to residents of Scotland; the rest of the United Kingdom has an alternate debt solution option.
One of the initial things a protected trust deed practitioner will ask is the complete amount of unsecured debt. Not many trust deed providers will want to take a case where the amount owed is lower than Ã‚Â£10,000, however, there’s no minimum amount essential for a protected trust deed. The complete sum of unsecured debt shouldn’t incorporate mortgages or other financial commitments such as hire purchase or leases. Connected shortfall debts might be applicable but you ought to discuss this with a trust deed advisor.
If your debt total is significantly less than Ã‚Â£10,000 you should think about sequestration (bankruptcy), the debt arrangement scheme or a DMP if you can’t cope with your debts.
How much your assets are worth is of particular importance to a Scottish trust deed advisor. Assets include a large variety of things but would normally consist of a car worth more than Ã‚Â£3,000 or home equity. Other examples could be an endowment policy or other kinds of savings (though pension arrangements would normally be exempt). Qualifying assets “vest” in the Trustee and might be needed to help pay back creditors.
If you are a homeowner with equity you will need to realistically consider whether you have the ability to access that equity and pay it into the protected trust deed. If you don’t have the ability to do this your house may later need to be sold. Therefore, consideration of the DAS scheme is encouraged as it would protect the home and enable repayment of what you owe in an affordable way.
Prior to entering into a trust debt or any other kind of debt resolution option you will need to calculate how much you are able to repay every month, if this number is below Ã‚Â£150 you may be able to use a trust deed. For high levels of debt you might have to repay a lot more to fulfil the requirements of your creditors. If you are not able to repay a moderate contribution you may need to explore bankruptcy as an avenue.
Being able to pay a large monthly instalment can sometimes mean that a protected trust deed won’t be an option. For example, if the value that can be paid back every month adds up to more than the total debt (over three years) consideration should be moved to the debt arrangement scheme or an informal debt management plan.
Some professions have limitations regarding formal debt resolution choices such as trust deeds. It can be an entry barrier or for professions such as police officers, prison officers or the armed forces there are strict processes to follow before continuing with a protected trust deed. Individuals employed in the financial services sector should look over their employment contracts as this could include specific restrictions.
Trust-Deed.co.uk is a long-established interface between Scottish trust deed professionals and the general public seeking advice on debt and debt solutions. The site recommends that you should not rely solely on the details explained in this piece without initially seeking advice from a suitably qualified person. All of the advisers at Trust-Deed.co.uk are qualified to provide advice on the appropriateness of a protected trust deed, and other similar alternatives.