A Scottish trust deed is actually a formal agreement that takes place between the two individuals who are both residents of Scotland. The deed also binds a legal advisor who is also known as a trustee or insolvency practitioner. The form of the trust deed will be put forward by the legal advisor and that will be offered to the creditors for their acceptance. If the terms and conditions are suitable for the creditors, it will be approved and from that time onwards the trust deed will come into action. This is the basic concept of a trust deed. But certain things are there that you need to know before the formation of the trust deeds. In this article we are going to provide you with the additional information about the deeds that will help you in the long run.
This will help you in paying off your debts as much as possible; but know that the trust deeds are formatted in such a way that 89.9% of your overall debts will be paid off and this is the reason you need to plan your debts carefully. Arrange your debts on the basis of your priority. The debts will be paid according to your monthly income and the deed will last for a period of 4 years according to the new amendment.
Now, there are certain criteria for making it a protected one and if the criteria are met, the deed will be a protected deed. One of the major advantages of availing a protected deed is the creditors will not at all be allowed to contact you in the period of 4 years and thus it eradicates any threat from the creditors. The interest and bank charges are completely frozen.
Throughout the process, there is absolutely no court involvement and this is not as formal as bankruptcy. Only the unsecured debts will be included as value of the trust deeds and any secured debts that include major assets like house, cars or other assets do not come under the format of trust deeds. Another important factor that you need to know is, there is not at all any specific set of money that you need to repay; this can be said to be a Scottish version of the IVA. But you definitely need to be a resident of Scotland.
According to trustdeedcalculator.co.uk for a protected trust deed, if you are able to show that you can repay the maximum amount, then it is possible that you shall have to repay only 10% of the total debts and the rest of the amount will be written off after the period of 48 months. Once you have entered into an agreement, there are no chances that the creditors take any action against you. This is completely a legally binding process. No more phone calls, letters or threats. This is the reason a protective trust deed is always a better option and you can start living a stress-free life once again.