For those trying to get out of debt, it’s been a difficult few years.
If the idea of paying off your debts is giving you sleepless nights, a Trust Deed may be one of the best steps you can take that will quickly help you get out of debt.
Although there are other options available to you, such as the Debt Arrangement Scheme, these can take a considerable number of years to complete, often involving stressful negotiations with creditors. A Trust Deed on the other hand, does not and is often a better choice when you need to deal with debt quickly:
Write Off A Percentage Of Your Debt
A Trust Deed can help you write off a portion of what you owe and help you get out of debt faster. Your creditors won’t get a substantial proportion of the interest and charges they have heaped on your original borrowings.
In This Guide...
Less Time To Get Out Of Debt
A Trust Deed takes typically 48 months to complete compared to the debt arrangement scheme, which could take years to complete depending on how much you owe, so you’ll be debt free faster.
Quick To Setup
A Trustee can set up the arrangement within weeks of your first conversation.
No More Interest
Creditors cannot charge you any more interest on your debts once you’re in the repayment plan and all interest, fees and charges are frozen.
Experienced Professional On Your Side
You have the support of a Trustee with an in-depth knowledge of finance and law. Their experience means they can offer advice on how to deal with unexpected financial events that would ordinarily push you off track if you were on a DMP.
Your Trustee handles all the negotiations with your creditors. Instead of trying to persuade creditors to accept your debt payment plan, your Trustee (Insolvency Practitioner) arranges a payment plan with your creditors instead.
No More Hassle From Creditors
Because they involve a legal agreement, your creditors are prohibited from contacting you or trying to get you to break the terms of your Trust Deed. This means you can focus all of your attention on how to get out of debt faster instead of worrying who is phoning or banging on the door. With DMPs however, there’s nothing to stop a creditor trying to reopen negotiations or going back on your agreement with them.
Trust Deeds can teach important money management skills, which means as you become more financially savvy you can end up finding ways and means to pay more and get out of debt faster.
You’ll find your creditors won’t like the idea of you having a Trust Deed to get out of debt. They want you to do it the long way so they can get back as close to 100% of the money you owe them. But that will invariably lead to hardship on your part.
The most important thing for you is to find a way to pay it off as fast a possible with the minimum amount of stress. So disregard what your creditors want and focus on what you want: an overall reduction in your debt, to get out of debt faster, affordable monthly payments and a better standard of living.
Trust Deed Example
Example Unsecured Debts
|2||Credit card 1||£6,812|
Your Monthly Repayments Would Be
a Scottish Trust Deed £748
(total contractual repayments)
a Scottish Trust Deed £295
(total contractual repayments)
* Subject to creditor acceptance
* Payment subject to individual circumstances
* Credit rating may be affected
* Fees apply, subject to individual's circumstances. For more information on our fees click here