Trust Deed: How It Works - Official Trust Deed Scotland® (2023)

Step 1: See if you qualify
It’s real easy to get started. Simply use our Trust Deed Wizard® tool to check what formal debt solutions you may be eligible to apply for.

98.5% of our proposed Trust Deeds gain protection status making us No.1 in Scotland last year¹

97.9% of our customers rated our service as Excellent on Trustpilot²

99.9% of our proposed Debt Payment Programmes (DPPs) under the Debt Arrangement Scheme are approved by creditors³

To find out more about how we can helpwrite off up to 70% of your unaffordable debt, try ourWizard tool now, or you can give us a call in confidence, on 0141 221 0999.

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Step 2: Find out what your options are

Our Trust Deed wizard can speed up the advice process, this is an easy to use application.

(Video) What is a Trust Deed? Scottish Debt Solutions Explained

Other options available to you will include:-

  • Do nothing – pay off the debt yourself
  • Debt Arrangement Scheme (DAS)
  • Sequestration
  • MAP
  • Debt Consolidation Loan

Our advice is to not rush into anything.

Our FCA-regulated advisors are at hand to let you know about all the available options to help you become debt-free – however, only you can make the final decision on what will suit you the best.

If you want to proceed with a Trust Deed, or any other debt solution, we will work with you to calculate an amount that you can afford to pay every month, and we’ll guide you through the process

In addition, as well as being affordable for you, your monthly payment amount has to be acceptable to the creditors for them to proceed.

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Step 3: Agree terms and sign your Trust Deed

Once you are happy to go ahead with a debt solution, we’ll start drafting your case.

Once this is done, we’ll arrange a final signing call where your debt adviser will go over all the paperwork with you and answer any questions you may have to make sure you’re 100% satisfied with the terms.

If you are happy to proceed, you’ll sign off on the Trust Deed. You’ll then arrange a suitable date for the first payment which will now be based on your affordability.

The payment (which is the same each month) replaces all other monthly debt payments to your creditors.

(Video) What is a Trust Deed? - Scotland Trust Deeds

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Step 4: Get your Trust Deed protected

After you sign your Trust Deed, the next step is to get it approved by your creditors to protect it.

Our Trust Deed proposals currently have a 98.5% creditor protection rate¹.

However, to ensure your expectations are managed from the start, your debt adviser will let you know what the expected outcome shall be and whether you are likely to be accepted/rejected, based on their previous experience of cases just like yours.

Once your paperwork is processed, this will be registered on the AiB (Accountant in Bankruptcy) website, where your creditors can access it. They usually have five weeks to accept or reject it – the decision will be relayed to you by the Insolvency Practitioner (your ‘Trustee’), as creditors can’t directly contact anyone who has entered a Trust Deed.

This five-week period is known as the ‘protection period’. After it lapses, with no claim from your creditors, you’ll receive your protection letter from your trustee, making you aware that your trust deed has been fully approved and that you’re now in a protected trust deed agreement.

Getting your Trust Deed approved gives you legal protection from your creditors.

As long as you stick to the terms of the Protected Trust Deed, creditors can’t take further action to pursue the debt.

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Step 5: New reduced monthly payments

Typically you make your first payment within the first four weeks before your Trust Deed becomes protected. This can be set up between you and your advisor for a time of the month that’s comfortable for you.

For example, if you’re paid a salary at the end of each month, your advisor could arrange your Trust Deed payments to be scheduled for just after then.

(Video) A trust deed simply explained

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Step 6: Be debt-free in four years

After your Trust Deed term is finished, any remaining debt will be written off, leaving you free of debt.

It usually takes four years, but this can be extended to allow you to make additional payments, which you will have agreed to before entering the Trust Deed. This can sometimes occur to allow you to pay off your debt using equity, which involves paying a larger amount over a longer period of time. Again, this will have been agreed with you at the start of your Trust Deed term depending on your level of debt.

If your circumstances change during your trust deed ie. redundancy or change in your income, it is important that you let you trustee know of these changes, and they will work with you to help conclude your Trust Deed.

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Trust Deed Scotland® – Why you can trust us

At Trust Deed Scotland® we have been giving debt advice since 2009 and in that time, we’ve helped put thousands of people into a formal debt solution that has enabled them to enjoy life after debt.

We give tailored debt advice on all Scottish debt solutions, not only Trust Deeds and have helped more than 25,000 people in Scotland enter into Protected Trust Deeds, or alternative solutions.

We understand that being in debt and struggling with repayments can be stressful.

(Video) All Inclusive Trust Deeds (AITD) - Investors Workshops

Our non-judgemental advisers have spoken to many people throughout the years with differing reasons for how they found themselves in debt. While no two cases are identical, we’ve got the weight of experience that most others don’t and we’re committed to giving you the best possible advice.

This page explains all you need to know about how Trust Deeds work and how to apply for a Trust Deed.

Advantages of Trust Deeds

  • Your debt payments will be more affordable because they’ll be based on your disposable income. Your monthly debt payment will usually be significantly lower than if you’re making multiple payments each month to different creditors.
  • Interest on your existing debts will be frozen when your trust deed term starts.
  • After you’ve finished making the payments agreed under your Trust Deed, the rest of your debt will be written off. Creditors can’t demand that you pay them the rest of what you owe, but you need to stick to the agreed schedule for debt payments.
  • Unlike bankruptcy, if you own a home, it will be protected as long as you stay within the terms of your trust deed. However, you may have to agree to additional payments to protect your equity – your advisor will go over this with you before you enter your Trust Deed.

Disadvantages of Trust Deeds

  • A Trust Deed will harm your credit rating and stay on your credit record for six years. Banks and other loan providers check this record when deciding whether to give you a credit card or loan.
  • A reduction in your credit rating will make getting new credit harder and more expensive during and after the Trust Deed term.
  • A Trust Deed may not be an option with certain job types.

To find out more about what a trust deed is, visit ourProtected Trust Deedspage.

Getting Trust Deed advice

  • If you’re struggling to pay your unaffordable debt, you should consider getting advice from an FCA authorised debt adviser, or from a registered debt charity. This will enable you to evaluate your true affordability and allow you to gain access to the full spectrum of options open to you.
  • A Trust Deed is a legal arrangement for Scottish residents and uses formal Scottish legislation.
  • A Trust Deed can take away the stress of juggling multiple unsecured debts (e.g. loans and credit cards) by combining them into a single, lower monthly payment.
  • Trust Deeds usually last four years, after which any remaining debt is written off if that’s been agreed with your advisor from the start.
  • Debt Help Scotland – includes alternatives such as DAS.

What is a DAS?– Find out more about the Debt Arrangement Scheme.

For more information on how to become debt free, call us on 0141 221 0999or

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¹In 2021, we achieved a protection rate of 98.5%, this made us the best performing volume provider of Protected Trust Deeds in Scotland. Trust Deeds advertised between 01/01/21 and 31/12/21. ²Reviews collected between October 2012 and June 2022, a total number of 5,198 reviews were received, 5,089 people rated us as ‘excellent’. A further 107 people rated our service as ‘great’. ³In this sample of 1,144 Debt Payment Programmes (DPPs) under the Debt Arrangement Scheme (DAS), approved between July 2019 and October 2021, only 1 proposed DPP was rejected and unable to proceed. ⁴The expected debt write-off figure of up to 70%is based on 5,234 Protected Trust Deeds currently administered byTrust Deed Scotland® and granted between January 2017 and September 2021. The expected write-off % includes the costs of administering each Protected Trust Deed (PTD). More information relating to the costs of administration can be found by clickinghere. In this sample of PTDs, the expected write-off figure reaches as high as 83%. 5% of the PTDs have an expected write-off figure between 71% and 83%. 95% of the PTDs have an expected write-off figure of up to 70%, the average (mean) being 45% when the costs of administration are included. Of the cases in this sample, 1,823 were granted since the Covid-19 pandemic took effect in 2020. The average expected debt write-off for these cases is slightly higher at 49% when the costs of administration are included.

(Video) How to Get Out of a Trust Deed (Step-By-Step Guide)


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