Check If You Qualify

What are the options for dealing with debt in Scotland?

Sharon McDougall - Updated - 8th May 2024 - 2 minutes to read

Scotland has a number of formal debt solutions that can help you deal with a difficult financial situation. It’s advisable to take action as soon as possible, however, to prevent your levels of debt escalating when interest and other charges are added.

Obtaining professional advice is key in this respect. An approved money advisor or licensed insolvency practitioner (IP) can explain your options, and help you decide on the best way forward.

They’ll assess your financial position by looking at your income and expenditure, identifying which debts should be given priority, and calculating how much you can afford to pay your creditors each month.

What are the unofficial ways to deal with debt?

Initially, you should try to negotiate with creditors for a more affordable repayment plan. If you contact them as soon as you’re unable to make a repayment, they may be more likely to let you pay over an extended period of time, or at a lower rate each month.

A professional adviser will negotiate on your behalf if necessary, and suggest ways to maximise your income – you might be able to claim a state benefit, for example, or you could be eligible for tax credits.

If your situation is such that only a formal debt procedure is appropriate, however, there are three main options available in Scotland.

Scotland Debt Calculator

Get a rough indication of what your repayments might be under each of our different debt solutions.

Your Total Debt

£0 - £5,000

£5,000 - £10,000

£10,000 - £20,000

£20,000+

Your Employment Status

I am employed

I am self-employed

I am unemployed

I am a student

I am retired

Your Total Monthly Income

£0 - £1,000

£1,000 - £2,000

£2,000 - £3,000

£3,000+

What can you pay monthly towards your debt?

£0 - £100

£100 - £200

£200 - £300

£300+

How can I use a Debt Arrangement Scheme (DAS)?

The Debt Arrangement Scheme is backed by the Scottish government, and allows you to repay your debts in full without having to deal with creditor pressure or the threat of legal action.

A single affordable payment is made from your disposable income to the scheme administrator each month. As the interest and charges on your debts are frozen, it’s easier to maintain the repayments and regain control of your finances over the longer-term.

What is a Trust Deed?

A Scottish Trust Deed provides an alternative to bankruptcy, and lasts for four or five years. With this option, any debt remaining at the end of the term is written off, allowing you to start again without the pressure of debt.

Although your home isn’t at risk as with bankruptcy, you may be required to release equity in year four, by remortgaging. If this isn’t possible, the trust deed term might be extended by 12 months.

What is the process of Sequestration?

Sequestration is the name for bankruptcy in Scotland, and carries with it the most serious ramifications when compared with other options. You pass control of your assets to a trustee, and as a result your home may be sold to repay creditors.

If there is no hope of repaying your debts, entering sequestration offers you the chance of a fresh start, and removes the pressure of being pursued for repayment by creditors.

For more information on your options when dealing with debt, call one of the team at Scotland Debt Solutions for a free initial consultation. We’ll make sure you understand the different debt procedures available for residents of Scotland, and guide you towards the best solution.

facebook colour icon linkedin colour icon messenger colour icon whatsapp colour icon email colour icon
Sharon McDougall Square

Sharon McDougall

Manager

Other Articles

What to do if you are in debt to Clearpay Stressed woman looking at debt bill

What to do if you are in debt to Clearpay

Clearpay lets you spread the cost of your purchase through 4 instalments, due every 2 weeks. The payment option is available online, through the Clearpay app, and you can also use a digital payment ca...

What to do if you are in debt to PayPal Man holding a credit card

What to do if you are in debt to PayPal

Buy now, pay later (BNPL) services are gaining popularity due to their easy access and flexible repayment options. BNPL is highly appealing as it lets you spread the cost of a purchase, rather than ma...

9 practical tips for cutting your household expenses Household Expenses

9 practical tips for cutting your household expenses

We all want to save on our household bills and have more money in our pocket for the fun things in life. While bills are an unavoidable fact of life, here are some ways you can help to reduce them:

About

Why Choose Us

Usp Discussion

Speak Direct With

A Qualified Adviser

Headset

We Don't Operate

Call Centres

Usp Location

5 Offices in Scotland

National Coverage

Usp House

Ask us About

Home Visits

Usp Award

Fully Regulated Advisors

From a Reputable Firm

Usp Hand Heart

Helping Scots Get

Out of Debt Since 1989

We'll give you a call

Our Scottish based team can help advise you on your debt problems.

Here at Scotland Debt Solutions we take your privacy seriously and will only use your personal information to contact you with regards to your enquiry. We will not use your information for marketing purposes. See our Privacy Policy.

Tools

Useful Tools

Personalised Debt Report
Usp Planner

Personalised Debt Report

Our personalised debt report will help you better understand your financial position and see where your money is going.

Debt Report
Instant Scheduled Call & WhatsApp
Headset

Instant Scheduled Call & WhatsApp

Arrange a call with an expert advisor at a time to suit you or contact our team via WhatsApp for immediate help and advice.

Arrange Callback
Find a Local Office
Usp Signpost

Find a Local Office

We have five offices located across Scotland. Find your nearest one here.

Find an Office

OUR SERVICES

We can help you with...

Sequestration

Sequestration

Sequestration is the Scottish version of bankruptcy and may be suitable for you if you do not have the money to pay back your debts

Find out More
Trust Deeds in Scotland

Trust Deeds in Scotland

A Trust Deed involves making a monthly contribution to your debts for up to four years. After this time any remaining debt included in the Trust Deed will not need to be paid.

Find out More
Debt Arrangement Scheme (DAS)

Debt Arrangement Scheme (DAS)

A Debt Arrangement Scheme (DAS) lets you pay off your debt through a series of manageable instalments over a reasonable length of time.

Find out More
Business Debts
Icon Briefcase

Business Debts

Whether you are a sole trader or a limited company director, we can help you work through your current financial problems including money owed to HMRC

Business Debts

Our Insolvency Practitioners are regulated by ICAS or the IPA and our firm is authorised and regulated by the Financial Conduct Authority

Fees and Information: There are fees associated with our services. These will be fully explained before entering into any of the personal debt solutions referred to on this website. Full details of our fees and how these are charged are fully explained to you prior to you committing to any particular service.

ICAS Insolvency Practitioners