Pros and Cons of a Scottish Trust Deed

If you’re thinking about applying for a Trust Deed it is important that you look at all the pros and cons of doing so and make a decision once you know all the facts.

Take a look at the following questions, if you find yourself answering ‘yes’ to all of them, then there is a good chance that a Trust Deed arrangement could be exactly what you’re looking for.

Do you currently have large unsecured debts of £10,000 or more to multiple creditors?
Are you struggling or unable to meet your monthly repayments?
Are you in employment and can afford to make regular monthly payments towards your debts for the next 3 years?
Do you live in Scotland

Here’s a run-down of the pros and cons of a Scottish Trust Deed.

Pros of a Scottish Trust Deed

  • It is a legally binding agreement
  • At the end of the Trust Deed term (usually 3 years), any unpaid debt is written off
  • A Trust Deed will help reduce your repayments into one affordable monthly payment
  • All charges and interest will be frozen on your debts
  • You’ll have a set date of when you will be debt free
  • A Protected Trust Deed will grant you legal protection from any further action from your creditors
  • A Trust Deed will avoid you the social stigma and financial consequences of entering into sequestration (bankruptcy)
  • Protect your career – no statutory restrictions on employment

Cons of a Scottish Trust Deed

  • A Trust Deed requires commitment in the form of regular monthly payments for the full term of the Deed (usually 3 years)
  • You won’t be able to apply for any further forms of credit for the duration of the Trust Deed agreement
  • If you fail to stick to the terms of the Trust Deed agreement you could be make bankrupt
  • The Trust Deed arrangement may require you to:
  • Remortgage to release the equity in your property
  • Pay extra if you earn a bonus or overtime
  • ‘Trade down’ to a cheaper vehicle or sell other valuable assets
  • With a Trust Deed you will end up repaying more of the debt you owe than if you went through sequestration
  • Your Trust Deed will stay on your credit file for 3 years after its successful conclusion, which may make it more difficult for you to get credit
  • The granting of the Trust Deed is advertised to creditors in the Edinburgh Gazette
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By submitting your information you are agreeing to be contacted by a specialist debt advisor who will help you find the best debt solution to suit your particular circumstances.

About Trust was launched to help provide debt information and guidance for people living in Scotland.

We know that being heavily in debt can significantly affect your quality of life. But aims to help to relieve some of the burden by giving you the right tools and information you need to begin reducing your monthly repayments.