Scottish Trust Deeds

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by: Hollie Wilcox
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Word Count: 352
Date: Fri, 31 Jul 2009 Time: 6:15 AM
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For those consumers who are seeking assistance in eliminating their debt, there are many options available to them. For residents of Scotland one unique option exists that is not available in other countries. This option is known as the Scottish trust deed. This would be a suitable solution for those with high amounts of debt. This option is more formal than a debt management plan. However, a trust deed is not as obtrusive as a declaration of bankruptcy.

A trust deed would consolidate all of your debts into one monthly payment. This payment would be more affordable than the current payments were making. Typically repayment occurs over 36 month period. When determining the monthly payment certain considerations are made first. Starting with your income the typical cost of living would be subtracted. Additionally considerations would be made for your assets and liabilities. With all of this information gathered a reasonable payment can then be decided upon.

If you choose to opt for a Scottish deed trust you will need some professional assistance. The services of an insolvency practitioner also known as a trustee would be needed. The trustee serves as the neutral party between you and your creditors to ensure that the proposal is fair to both parties. Consumers do have the option to approve the deed trust before it is put into action. Then the plan is presented to the creditors for final approval. The plan will be accepted if creditors holding more than a third of the debt do not vote against the proposed plan. Once the plan is approved it is known as protected. This means that all of the creditors must legally abide by the plan.

Following the approval of the trust deed, the role of the trustee changes. The trustee's job is now to monitor the trust deed and ensure that it is being followed. If a consumer follows this trust deed and makes consistent payments for the designated 36 month period in their debts would be eliminated. If there are any accounts with outstanding balances, they would automatically be written off and the consumer would be debt free.

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For more information on how you can use debt management plans to free yourself of debt, then visit the experts at www.debt-free.org.uk today.