Frequently Asked Questions

• How long does it take to set-up a Protected Trust Deed?
• Will I lose my house if I enter into a Protected Trust Deed?
• What if my financial situation changes?
• Can a Protected Trust Deed be cancelled?
• Is anybody able to find out that I'm in a Protected Trust Deed?
• Do I have to notify my partner, family or my boss?
• Does a Protected Trust Deed affect my employment status?
• I own a business, will a Protected Trust Deed mean I have to close it?
• How long does a Protected Trust Deed last?
• Is a Protected Trust Deed the right solution to my debt problem?
• Why have I heard lots of things about IVAs (Individual Voluntary Arrangements)?
• Is a Protected Trust Deed another name for bankruptcy/sequestration?
• What happens if I can't keep up payments on my Protected Trust Deed?
• What happens at the end of the Trust Deed?
• Is all debt covered by the Protected Trust Deed?
• What's the difference between a secured debt and an unsecured debt?
• Which creditors can be included in a Protected Trust Deed?
• What make you think my creditors will agree to a Protected Trust Deed?
• Do creditors have to accept the terms of the Protected Trust Deed?
• Can a single creditor refuse the Protected Trust Deed and stop it progressing?
• Will I be protected from further recovery action, charges and interest?
• What happens if the Protected Trust Deed is not approved?

[top] How long does it take to set-up a Protected Trust Deed?

The process of statring a Protected Trust Deed can begin immediately and is usually set-up and fully in effect within 6 weeks. Our professional advisors can give more specific timings if you complete your details.

[top] Will I lose my house if I enter into a Protected Trust Deed?

No - a Protected Trust Deed does not take your house, but if you have equity in your property, then this will be taken into account and you may need to release this equity to help pay your creditors. If the property is joint-owned, then an appropriate amount of the equity will be taken into consideration, not the whole amount.

[top] What if my financial situation changes?

Under a Protected Trust Deed, you have to inform your Trustee of any changes in your financial circumstances, either good or bad. If your income is reduced, the Trustee will propose a variation on the terms of the Trust Deed to reflect your new circumstances. If your income is increased, then the Trustee may propose other variations. Our professional advisors are happy to give more details on how this could affect you.

[top] Can a Protected Trust Deed be cancelled?

No, a Protected Trust Deed cannot be cancelled. Your creditors must abide by the terms of the Protected Trust Deed and accept what has been agreed, as must you. That means keeping up repayments as agreed at the outset. When the Protected Trust Deed is first set up, you will have plenty of input with your Trustee.

[top] Is anybody able to find out that I'm in a Protected Trust Deed?

No. A Protected Trust Deed is completely confidential. Our professional advisors are trained on how to deal with your situation confidentially. Only those dealing with your Protected Trust Deed and your creditors will be aware of your position. No details are published, unlike bankruptcy, so no-one will know unless you decide to tell them..

[top] Do I have to notify my partner, family or my boss?

You can choose to notify whoever you wish, and may choose not to notify your family or partner. Our professional advisors would advise that you do inform those that are very close to you in order to share any pressure you may be under.

[top] Does a Protected Trust Deed affect my employment status?

No. A Protected Trust Deed is a sensible route for responsible people dealing with their debt problem, and will not prejudice your employment. regardless, a Protected Trust Deed is confidential, so your employers will not know that you are in a Protected Trust Deed.

[top] I own a business, will a Protected Trust Deed mean I have to close it?

No - unlike bankruptcy you will not have to give up your business or directorship in a Protected Trust Deed.

[top] How long does a Protected Trust Deed last?

A Protected Trust Deed lasts for a maximum of 3 years - just 36 months. Sometimes a Protected Trust Deed may last for under three years, but this depends on individual financial circumstances. Our professional advisors would be pleased to explain the various options available to you.

[top] Is a Protected Trust Deed the right solution to my debt problem?

Our professional advisors always provide the most appropriate, unbiased advice for your debt problem, and our advice is at no cost and without obligation.

We are aware that some debt solution providers only promote the solutions that make them the most money and avoid considering the full range of solutions available. We always provide the best advice and offer a complete range of solutions based on each individual.

[top] Why have I heard lots of things about IVAs (Individual Voluntary Arrangements)?

A Protected Trust Deed is simply the loose-equivalent of an IVA for residents of Scotland.

[top] Is a Protected Trust Deed another name for bankruptcy/sequestration?

No, a Protected Trust Deed is a less formal process than sequestration (bankruptcy). They are both governed by the court but are different legal processes for persons with unmanageable debt.

[top] What happens if I can't keep up payments on my Protected Trust Deed?

Once in a Protected Trust Deed, it is very important that monthly payments are made as proposed. If at any point your financial situation changes and you can no longer afford the monthly payments, then you must consult your Trustee immediately.

If you don't keep up payments and make no effort to inform your Trustee then sequestration (bankruptcy) proceedings can be initiated against you.

What happens at the end of the Trust Deed?

Any remaining debt will be written off after the (maximum) 3 years - and you will be free from debt.

[top] Is all debt covered by the Protected Trust Deed?

Your Protected Trust Deed will cover any unsecured debt and arrears, such as unsecured loans, credit cards and rent arrears. It will not cover mortgages, or any loans secured against an asset.

[top] What's the difference between a secured debt and an unsecured debt?

A secured debt is a debt that is secured against assets you own, such as a house or a car. If you fail to keep up repayments on a secured debt those assets may be at risk. Unsecured loans are not secured on any asset.

[top] Which creditors can be included in a Protected Trust Deed?

You can include debt to credit or store cards, banks, finance companies, HM Customs & Excise (VAT), Inland Revenue, and loans made to you by your friends and family. Some of the debts that cannot be included are student loans, fines, mortgage debt, hire purchase, debt incurred through fraud, maintenance and child support arrears. Please talk to our professional advisors if you wish to check whether any specific debts can be included or not.

[top] What make you think my creditors will agree to a Protected Trust Deed?

Although the huge number of letters and calls from your creditors chasing your debt may suggest otherwise, many creditors actually want to help you with your situation in order to recover as much of their debt as is possible. If you communicate openly with them about your situation, they usually understand your problem and will - in most cases - accept less than you owe if that is all you can afford and as long as they are satisfied that you will keep to any agreement.

Sequestration (bankruptcy) is very costly and time consuming, and a large amount of the money raised from a sequestration (bankruptcy) goes to cover professional fees, with less actually going to the creditors

A Protected Trust Deed offers a repayment arrangement between yourself and your creditors with legal backing, without the high cost and low returns of a sequestration (bankruptcy).

Your creditors will welcome a Protected Trust Deed where appropriate, as it means that they will get some of the debt repayed, and see it as as an effective way of resolving the situation.

[top] Do creditors have to accept the terms of the Protected Trust Deed?

Two thirds or more of your creditors by value of debt MUST agree to the proposals for the Trust Deed to be classed as protected. If they don't, the Trust Deed can still go ahead but you will not be protected from further interest or recovery action.

[top] Can a single creditor refuse the Protected Trust Deed and stop it progressing?

Yes they could, but only if they account for a third or more in value of your total debt. If they account for less than a third in value then they will be bound by the terms of the Protected Trust Deed regardless if the other creditors accept the terms.

[top] Will I be protected from further recovery action, charges and interest?

If the Trust Deed becomes a Protected Trust Deed, your creditors will be prevented, under law, from taking any further action against you. This includes no more additional charges, and all interest will be frozen.

[top] What happens if the Protected Trust Deed is not approved?

There are different debt solutions to a Protected Trust Deed if the Trust Deed fails. Our professional advisors can explain the various options to you.