A Trust Deed is simply an arrangement whereby all your debts, liabilities, savings and assets are confirmed to arrive at your immediate financial situation. Those who take out a Trust Deed will likely have debts exceeding 10,000 pounds, and this may lead to some assets, non-essential assets, being sold off to pay back creditors as much as possible. However, do not automatically assume that all of your assets will be sold off because the trustees appointed to look after your situation will have to consider your future and more so if you have a family.
Scottish trust deeds are solutions for people who are full of debts. They are legally binding agreements that offer a more realistic arrangement for paying debts that occur typically in 3 years time. A trust deed is a way for debtors not to declare bankruptcy. Once a borrower qualifies for a trust deed, he only needs to deal with his trustee and not all the people he owes money from. The trustee will take the pressure off him. The arrangement will be a monthly repayment scheme for about three years.
Living life under a Trust Deed
In simple terms, the trustees appointed to your particular situation are effectively in control of all of your income and expenses. They will review your situation on a regular basis, and you will be legally obliged to tell about any material changes in your situation such as new employment, more debts confirmed and anything else which will make a material difference to your future.
However, when you take into account the enormous pressure you have likely been under before the creation of the Trust Deed, life under a Trust Deed is not as bad as it seems. The length of your Trust Deed will vary from anywhere between three years to 5 years, and once the Trust Deed has expired, you will be legally free of all existing debts.
Looking to the future
Bankruptcy and financial problems are subjects which are becoming ever more widespread across the Scotland as the economy takes yet another downward turn. Getting your debts grow and grow a recipe for disaster because, by the time you take legal advice and have a Trust Deed in place if you live in Scotland, you may well have already lost assets to the bank or even the bailiffs.
While Trust Deeds were put in place to protect assets which were potentially due to creditors, they also protect you from unwanted attention by debt collectors, bailiffs and other parties after financial settlements. Once you have taken out a Trust Deed, and it agreed by creditors representing a specific percentage of your debts (the figure will need to be confirmed when you apply for a Trust Deed), then legally you cannot be chased for existing debts. Any correspondence relating to these obligations should forward to your trustee who will respond to the relevant parties on your behalf.
Putting together a Trust Deed in Scotland than we have covered so far, the principle of the matter and the fact that they will in many cases assist those in financial trouble is evident.