FREQUENTLY ASKED QUESTIONS
Debt free in four years
Debt free in four years
Stop creditors harassing you
Pay only what you can afford
Trust deeds are a form of government legislation that was introduced in order to assist individuals who were finding it difficult to repay their debts. It gives people more flexibility to make affordable payments to their creditors.
A Trust deed consists of the individual making lower monthly payments towards their debts for up to four years, after which the remaining monies/debts owed will be written off. This helps borrowers who are in financial difficulty to make one affordable payment towards all their debtors and take the pressure off. This is a legally binding agreement and will stop any further contact from creditors.
The Repayment Period
Trust deeds normally run for 48 months (Four Years) and you pay the agreed lower monthly payment for this period. Most trust deeds take around 1 month to be set up, before being passed to your creditors for approval. This will take a further two weeks. Once it is all set up, the creditors are not allowed to make any contact with you.
Trust Deed Criteria
To Enter into a trust deed you must be a resident of UK. An insolvency practitioner who will be able to explain all your options to you, based on your current financial situation. The qualified insolvency practitioner will evaluate your income to debt ratio, such as mortgage/Rent, council tax, utility bills, and all other living expenditure. The funds remaining after all your essential expenditure has been deducted is normally the amount you would contribute towards your trust deed on a monthly basis. This will be explained and worked out on a case by case review.
Our creditors normally take up to 5 weeks to either accept or reject the trustdeed. If they reject the offer, or if only less than half of them reject ,you can start making the proposed payments. As you do not need 100% of them to agree , more 50% of them to have it go through.
Once you have successfully made your monthly payments at the end of the four year period, you are considered to be debt free, even if you have only made a fraction of the payments. The debts are written off and you are discharged from the Trust Deed and the Register.
After you’ve decided the Protected Trust Deed is the best solutions for your particular debt problems and you’ve sought the advice of a professional debt management company or adviser then you will be required to complete the paperwork which will provide your Trustee with all the information they need to register your deed and apply for the protection. An affordable monthly payment will then be agreed and a direct debit or standing order set up to pay the agreed amount directly to your Trustee who will then distribute the money amongst your creditors. One you reach the end of your agreement your deed will be discharged and the remainder of your debt written off. You will receive no further contact by any of the creditors included in the deed and you will be free of all debt, ready to create a more promising financial future for yourself and your family.
IS A PROTECTED TRUST DEED RIGHT FOR ME?
Protected Trust Deeds are an extremely sensible option if you have large, unsecured debts which have become unmanageable and you’re looking for a way to freeze the interest and reduce the monthly payments. They also allow you to majorly reduce the amounts owing by having a large proportion written off by your creditors through the Protected Trust Deed process.
There are many other debt solution options available to you, including a Seqestrian, Low Income Low Asset (LILA) and the Protected Trust Deed, so it is advisable to thoroughly consider these options and consult with a professional debt management company before making your final decision but, some of the benefits of the Protected Trust Deed route are listed below:
- You will no longer pay anything to any of your creditors apart from the PTD payment
- Creditors will, legally, no longer be able to pursue you.
- You will still be able to open a Bank Account
- Your business or ability to trade will not be affected
- You will not lose your home.
To qualify, you must be resident in UK and be able to meet the small regular payments.
You must consult with a professional debt management company and a Trustee who is registered to practice with the Financial Conduct Authority (FCA) and a registered insolvency practitioner.
When you apply, it is a legal obligation to declare all of your debts and creditors and provide an accurate account of your financial situations and any savings and assets which you may have. Failing to do this may result in the failure of your Protected Trust Deed and an insolvency of Sequestrian order being issued against you, which can lead to losing your home.
If you have any equity in your family home, endowment policy or other properties, your Trustee will seek to recover some of this equity to distribute to your creditors. This does not, however, mean you will be at risk of losing your home but, this possibility of losing equity should be very carefully weighed up when you consider whether a Protected Trust Deed suits your circumstances.
Take back control of your debts and contact us today to see how much we can save you!