If you’re intending to enter into a Scottish Trust Deed then it’s important to know that you can’t simply do this yourself. This type of legally binding agreement has to be set up and managed by a licensed and suitably qualified professional, otherwise known as a ‘Trustee’. If you are based in England, Wales or Northern Ireland you will need to look at their equivalent, an IVA. See IVA Advice for further details.
In this article we look at the overall process of setting up a Scottish Trust Deed.
Choosing the right Trustee is absolutely crucial to the success of any formal arrangement so be sure to take advice or recommendations from others in order to find the best solution for YOU. Whilst some people don’t mind working with larger firms, others prefer to work on a one-to-one basis with a dedicated advisor, and that’s perfectly understandable given the fact that they’ll ultimately become privy to very personal and private information about your finances. Whoever you choose to work with, do be sure to check their credentials and ensure that they’re fully regulated to undertake the important role of Trustee.
Once you’ve chosen your Trustee then he or she will need to discuss your finances in great detail. Before you attend this initial consultation (which should usually be free of charge), it’s a good idea to collate as much documentary evidence as you can. This should include details of your debts (i.e. who they’re owed to, how much is outstanding, what it relates to and so on). You should also provide as much information as you can about your income and outgoings. You can do this by producing copy pay slips and also evidencing any regular outgoings, such as utility bills, rent/mortgage payments, travel expenses, childcare fees etc. Where possible you should produce receipts or invoices. Without all of the information in full, you will not be able to stop bailiffs. Remember, it’s always best to produce ‘too much’ information to your Trustee as opposed to not providing enough.
After your consultation meeting, your chosen Trustee will start to work on a proposal for onward submission to your creditors. This proposal has to be adequate enough for your creditors to accept it and yet leave you with enough money to live on each month – hence the importance of being completely upfront about your financial situation from the start.
Once both you and your Trustee are happy with the intended proposal, this will be submitted to your creditors for consideration. Hopefully, the proposal will be accepted, in which case they’ll then be forbidden from making any further contact with you i.e. through phone calls, correspondence or even home visits. Thereafter, your Scottish Trust Deed will become ‘protected’ – usually around five or six weeks later. In the event that your proposal isn’t accepted then your Trustee will be able to advise you further on what you may be able to do in order to strengthen your proposition and this, of course, will depend on your own personal circumstances.
Finally, once your Trust Deed is in place you’ll simply be required to pay a set monthly amount to your Trustee for onward distribution to your creditors.
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