A debt relief solution that can be carried out in Scotland. It is a legally binding agreement that usually lasts four years between the debtor and all creditors. For a Trust Deed to become legally binding (Protected Trust Deed), creditors must agree to the proposal. If some but not all agree, the remaining creditors may still act such as applying to make you bankrupt.
A PTD can be prepared only by a licensed trustee, the so-called Insolvency Practitioner (IP) acting as a trustee. The agreement consists in the fact that the trustee will set a monthly amount that you could reasonably pay your creditors after deducting all bills and expenses. The amount of the cancelled debt depends on your personal circumstances.
All interest and additional fees are retained. You also do not have to sell your home or car and your creditors cannot continue to collect debt from you. After joining the Trust Deed, you must regularly pay back to the trustee the designated amount. After accepting the Trust Deed, the trustee collects his or her margin for running the case, which is always included in the monthly instalment. It is important to be aware that if you deliberately break the Trust Deed, the trustee's margin will not be refunded.