What are the implications of an unprotected Trust Deed?
If a Trust Deed is unprotected it means that creditors aren’t legally obliged to accept the proposed repayments and may still undertake legal action against your business, leaving you at risk of being forcibly wound up.
A further consequence of an unprotected Trust Deed is that charges and interest can be added to your debts. These additional amounts can significantly increase the overall amount that you owe.
The difference between protected and unprotected Trust Deeds
For a Trust Deed to achieve its main aim of helping you pay off unaffordable debt, it’s important to gain protected status. This makes the new arrangement legally binding, and provides you with certainty over your repayments.
Your creditors cannot take legal action against you as long as you pay the required monthly amount. Furthermore, there won’t be any additional charges or interest and you will no longer have to face creditor pressure in relation to these debts.
It’s important to seek trusted advice and guidance when considering a Scottish Trust Deed ‐ a reputable company will only put forward Trust Deed proposals they believe are likely to be sanctioned by creditors.
Scotland Debt Solutions has been helping Scottish residents to escape debt since 1989, and can establish whether a Trust Deed is your best option. If so, we’ll put forward a solid proposal to your creditors and support you throughout the process.
Please get in touch with our expert team for more information and independent advice. We operate offices throughout Scotland and can offer you a free, same‐day meeting to discuss your situation.
