Trust Deed payment plan

A Trust Deed is a legally binding agreement between you and your creditors.

You will agree to pay what you can afford for an agreed period of time (usually three years) and your creditors will agree that if you adhere to the terms of the agreement and successfully complete the Trust Deed, the outstanding balances of your debts after the agreed period will be written off.

Talk to us

By talking to one of our Financial Solutions Advisors we will be able to conduct a no obligation financial assessment of your current situation. From this we will be able to determine whether a Trust Deed is the right solution for your debt problems.

If we believe a Trust Deed is right for you, one of our appointed Insolvency Practitioners (known as a Trustee) will calculate how much you can realistically afford to pay towards your unsecured debts. To calculate how much you can realistically afford, they will take into account your monthly income and your essential expenditure, including the payment of your secured debts (including your mortgage if applicable), rent (if applicable) money spent on food and gas, electricity and water bills etc.

Putting together a proposal

Based on what you can realistically afford, your Trustee will put together a proposal to be presented to your creditors. The proposal will outline the monthly payments you will be able to make over the next three years and how much of your debt to them will be paid off.

Presenting your proposal to your creditors

Your Trustee will present your proposal to your creditors and details of it will also be advertised in the Edinburgh Gazette? For your proposal to be successful, 75% of your creditors by value of your debts must accept it. If your proposal is accepted, your Trust Deed will become legally binding, meaning it is protected by law.

Your Trust Deed payment plan will begin

With your Trust Deed accepted, you will now be subject to make the agreed payments for the agreed three year period, if you do this your Trust Deed will be successful and outstanding debts will be written off.
If you don't keep up with payments, your creditors can start legal action against you and they may petition for your sequestration.

It has to be noted that a Trust Deed is only designed for those with serious debt problems, by taking out a Trust Deed, your credit rating will be severely affected and the Trust Deed will remain on your credit file for six years. This can make it very hard and more expensive to obtain credit once your Trust Deed is completed.