For many people, a Trust Deed is a financial lifeline, but they are not suitable for everyone.
If you have debts you can no longer afford and you have a limited income, you will be unable to set up a Trust Deed and sequestration could be your only route.
Minimal Asset Process (MAP), is a route into Sequestration.
The Minimal Asset Process allows you to write off your unsecured debts in a short period of time if you are on a low income with no disposable income left after covering your essential living costs or your income is only from income dependent benefits.
Who Qualifies for MAP?
- You live in Scotland or have done within the last 12 months
- You have no disposable income
- You have not been bankrupt in the last five years
- You are not a homeowner
- You do not have any large assets
- You have debts of less than £25,000
- Your vehicle is worth less than £3,000
Advantages of MAP
🔸Reduce Creditor Contact
🔸The process usually lasts 6 months
🔸Debts are written off upon completion
🔸No setup fee
Disadvantages of MAP
❌ You are unable to act as a director of a limited company or be involved in the formation, promotion or day-to-day financial management of a limited company.
❌ It may harm your employment prospects, both now and in the future
❌ Will affect your credit rating
❌ For 6 months after your discharge, you cannot apply for credit of £2,000 or more, without telling the creditor that you are a discharged bankrupt
❌ For 6 months after your discharge, you cannot apply for credit of any amount when you already have debts of £1,000 or more, without telling the creditor that you are a discharged bankrupt
❌ For 6 months after your discharge, if you are self-employed, you must tell anyone that you do business with the name of your business when you were declared bankrupt
❌ You are unable to act as a Member of Parliament or a Justice of the Peace.
❌ You may be in breach of certain contractual obligations by being made bankrupt e.g. tenancy/lease agreements, various license’s, employment contracts, HP agreements, insurances etc.
Trust Deed Example
Example Unsecured Debts
1 | Personal loan | £8,000 |
2 | Credit card 1 | £6,812 |
3 | Council Tax | £4,092 |
4 | HMRC Debts | £5,399 |
4 | Overpayments | £5,200 |
4 | Overdraft | £700 |
Total Owed | £30,204 |
Your Monthly Repayments Would Be
a Scottish Trust Deed £748
(total contractual repayments)
a Scottish Trust Deed £295
(total contractual repayments)
60%
* 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