Protected Trust Deed
What is a Protected Trust Deed?
If you live in Scotland and are struggling to repay unsecured debts, then you could solve your financial situation with a Protected Trust Deed.
A Protected Trust Deed will help you to repay your debts at a more affordable rate for a fixed period that normally lasts for 3 years and as it’s a legally binding agreement, all interest and charges will be frozen. It also means you’ll be protected from your lenders – so they will no longer be able to contact you directly or petition for your Sequestration (Bankruptcy).
Another great benefit of a Protected Trust Deed, is that at the end of the Deed period, which normally last 3 years, any debts that still exist will be written off – leaving you free from debt included in the Deed after 36 months!
Call today for a no-obligation financial review, or complete the enquiry form and a member of our friendly team will call you back.
What a Protected Trust Deed will do for you
We’ll draw up a realistic repayment plan with you – making sure you have enough cash every month to pay for essentials like bills and food. We will then pass your case over to an Insolvency Practitioner (IP) of our choice who will then draw up a repayment proposal which they will present to your lenders.
A Protected Trust Deed is subject to lenders agreeing to be included in the Deed – which is not always guaranteed. You can learn more about this in the key information and fees section at the bottom of the page.
Because a Protected Trust Deed is legally binding, lenders must freeze all interest and charges by law – this means your debts will not increase.
The Protected Trust Deed will provide full protection from lenders – this means they cannot contact you at all during the Protected Trust Deed period. They cannot petition for your Sequestration either, so you can relax in the knowledge that no action will be taken against you while you repay your debts – providing you keep to the terms of the Deed.
When the Protected Trust Deed period comes to an end, any debts included in the Deed that still exist will be written off!
If you are a homeowner, you may be asked to release equity from your property in the final year of the Protected Trust Deed to help repay your lenders, but this will depend on your personal situation.
Providing you keep to the terms of your Protected Trust Deed and follow the advice outlined to you by your appointed Insolvency Practitioner, then you can be expect to become free from unsecured debts in 36 months.
Your Insolvency Practitioner is on your side until you finish your Protected Trust Deed, so if you have any problems or questions, all it takes is a phone call to get the advice you need.
Protected Trust Deed
- Fees & key info
At Baines & Ernst, we help people beat debt by offering the highest standard of service, expert debt advice and affordable solutions. Our fees depend on your personal circumstances, and we’re always honest and upfront about these costs. Click here to learn more about our fee structure for all of our services.
The initial Protected Trust Deed Advisory Service will be provided by Baines & Ernst but we cannot guarantee that your Protected Trust Deed proposal – as drafted by an Insolvency Practitioner – will be accepted by your lenders.
For a Protected Trust Deed to become protected and interest and charges to be frozen, one third or more of your lenders (by value) must agree to the proposal.
A record of the Protected Trust Deed will be held on your credit file for up to six years following completion.
Once a Protected Trust Deed is approved it is listed publicly on the Register of Insolvencies. Homeowners may be required to re-mortgage in the 3rd year and release available equity to pay off some or all of the debt.
A financial review will be carried out to create a realistic repayment plan once other expenditures including rent / mortgage, household bills and living expenses have been taken into consideration.
Only unsecured debts can be included in a Protected Trust Deed, this means debts not secured against your property. Household bills, child maintenance repayments and secured loans are also excluded.
Typical unsecured debts that can be included are credit cards, store cards, personal loans, payday loans, catalogue accounts, bank overdrafts.
You will have a cooling off period of 14 calendar days from the date the Protected Trust Deed Service commences, in which you can cancel the Protected Trust Deed in writing and the administration fee will be refunded.
After the cooling off period, you will not be able to cancel the Protected Trust Deed as it is legally binding once approved.
A copy of our Protected Trust Deed Service Terms of Business can be viewed here.
You can also view a free publication from The Insolvency Service ‘In Debt? Dealing With Your Creditors’ which provides an overview of some of the debt solutions that may be available.
Residents of Scotland can also look at the Scottish Governments ‘Debt Advice and Information Package’ guide here. There is also a free publication from the Accountants in Bankruptcy for Scotland called ‘Debt and the Consequences’.