How A Trust Deed Works
We give free and impartial advice on trust deeds, and have helped more than 15,000 people in Scotland enter trust deed agreements.
Trust Deed Scotland is a non-profit organisation. We give free and impartial advice on trust deeds, and have helped more than 16,000 people in Scotland enter trust deed agreements.
We understand that being in debt and struggling with repayments can be stressful.
This page explains all you need to know about how trust deeds work and how to apply for one.
Fill in our TRUST DEED WIZARD® to see what options you qualify for.
Our trust deed wizard can speed up the advice process, this is an easy to use application.
Other options available to you will include:-
Our advice is to not rush into anything. Our FCA-regulated advisors are at hand to let you know about all the available options to help you become debt-free – however, only you can make the final decision on what will suit you the best.
If you want to proceed with a trust deed, or any other debt solution, we will work with you to calculate an amount that you can afford to pay every month, and we’ll guide you through the process
In addition, as well as being affordable for you, your monthly payment amount has to be acceptable to the creditors for them to proceed.
Once you are happy to go ahead with a debt solution, we’ll start drafting your case. Once this is done, we’ll arrange a final signing meeting where your advisor will go over all the paperwork with you and answer any questions you may have to make sure you’re 100% satisfied with the terms. If you are, you’ll sign off on the trust deed and your first payment which will now be based on your affordability.
The payment (which is the same each month) replaces all other monthly debt payments to your creditors.
After you sign your trust deed, the next step is to get it approved by your creditors to protect it. Our trust deed proposals currently have a 98% creditor acceptance rate. However, to ensure your expectations are managed from the start, your advisor will let you know what the chances are you will get accepted/rejected, based on their previous experience.
Once your paperwork is processed, this will be registered on the AIB (Accountant in Bankruptcy) website, where your creditors can access it. They usually have five weeks to accept or reject it – the decision will be relayed to you by the insolvency practitioner (your ‘trustee’), as creditors can’t directly contact anyone who has entered a trust deed.
This five-week period is known as the ‘protection period’. After it lapses, with no claim from your creditors, you’ll receive your protection letter from your trustee, making you aware that your trust deed has been fully approved and that you’re now in a protected trust deed agreement.
Getting your trust deed approved gives you legal protection from your creditors. As long as you stick to the terms of the trust deed, creditors can’t take further action to pursue the debt.
Typically you make your first payment within the first four weeks, before your trust deed becomes protected. This can be set up between you and your advisor for a time of month that’s comfortable for you.
For example, if you’re paid salary at the end of each month, your advisor could arrange your trust deed payments to be scheduled for just after then.
After your trust deed term is finished, any remaining debt will be written off, leaving you free of debt.
It usually takes four years, but this can be extended to allow you to make additional payments, which you will have agreed to before entering the trust deed. This can sometimes occur to allow you to pay off your debt using equity, which involves paying a larger amount over a longer period of time. Again, this will have been agreed with you at the start of your trust deed term depending on your level of debt.
If your circumstances change during your trust deed ie. redundancy, or change in you income , it is important that you let you trustee know of these changes, and they will work with you to help conclude your trust deed.
To find out more about what a trust deed is, visit our Protected Trust Deeds page.
For more information on how to become debt-free, call us on 0141 221 0999 or email email@example.com.