Is A Scottish Trust Deed The Perfect Debt Solution For Scottish Residents?
Ever heard of a Trust Deed? No? I didn’t think so, don’t worry, not many people have, but just to enlighten you Trust Deeds are actually a highly effective solution to help people who are struggling with their finances to get out of debt for good. A Scottish Trust Deed is not something that has been conjured up by a financial company, it is an approved scheme which was set in place by the government to help struggling Scottish residents become free from their debt problems. Scotland, like the rest of the country, and the world in fact, has its fair share of debt problems, mainly brought on by the recession which, in turn, was bought on the by the banks. Those high flying bankers have left the economy in a state of disarray through sheer greed. Now they are sat their laughing while the governments pumps more money into yet another bailout, and as usual, it’s the taxpayer that has to foot the bill. It will take years for the economy to recover from the financial crisis and it will be our grandchildren who will be sharing some of the burden. Anyway, back onto the main topic now…
So, tell me, what is a Scottish Trust Deed exactly? A Scottish Trust Deed is basically a formal arrangement between you and your creditors to repay what you can afford towards your debts over a set period of 36 months. You pay one lower, set amount for this period and then any remaining debt left at the end is legally written off by your creditors. If you were to take out a similar arrangement in England you would find it would come under an IVA (Individual Voluntary Arrangement) but a Trust Deed has more favourable criteria.
200 per month is not the set amount for an IVA There is a lot of misleading information in circulation regarding IVAs. Most people assume you pay 200 per month and then in 60 months you are debt free, but to be honest it all depends on your circumstances. The main factor is that you must be able to repay at least 25% of the total debt over the 60 month period, so if this works out at 200 for you, great! But it doesn’t for everyone.
The minimum period for a Trust Deed is 36 months (3 years), 2 years less than an IVA and you must owe no less than 10,000 a difference of 5,000 in comparison. On top of this you must be able to repay only 10% of the debt and afford 150 per month, a staggering difference. So if you are a Scottish resident who owes over 10,000, can afford 150 per month and is struggling with your debts your in luck, there is a solution!
No everyone is suited to a Trust Deed… So if you have been sold on the benefits of a Trust Deed, remember they are not for everyone. They are only meant for people who cannot find a suitable solution to their debt problems and who are genuinely struggling to keep up their repayments on their debts. Viable reasons to take out this Scottish debt solution would be if you lost your job, had a reduction in salary or you took out too much debt. Trust Deeds are exceptionally good if you are a homeowner who is facing financial difficulty as it can prevent repossession.
Another important bonus of a Trust Deed is the interest and charges are frozen, meaning the debt will not accumulate like it probably is now where the majority of your monthly repayment is going in the banks pocket and only a small percentage of your debts are actually being paid off each month.
There are downsides though. Your credit rating will be affected during the 3 year period whilst you are in the Trust Deed program and wont recover until long after, but if you are in a serious position with your finances the likely hood of you wanting to obtain further credit after the period is slim as most people would want to steer clear of debt for good! So, on that basis you will probably not require the use of your credit rating. Your reputation will also be damaged, although this is not important to everyone. I think relieving the stress of being in debt actually outweighs this by miles!
For more information on how to write off debt in Scotland with a Trust Deed visit our website. Use our Trust Deed calculator to see if you qualify. Get on the road to debt freedom!
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