A TD is a Scottish protected trust deed, which is applicable in Scotland only. It is regulated by the Accountant in Bankruptcy and is considered as a voluntary but formal arrangement that is used by Scottish residents only. In trust deed the debtor grants a trust deed in favor of the trustee which transfers their estate to the trustee for the benefit of creditors.
There are certain requirements for entering the trust deed agreement. The foremost important is that a borrower must be the resident of Scotland. One you show the prove; the need to consult the services of an Insolvency practitioner who will be able to explain all your options to you, based on your present financial situation. Hence it is important to note that the deed is made as per the current financial situation and ability to repay the amount as well. The qualified practitioner is there for the evaluation and hence they ensure that there is compatibility against our income to debt ratio, such as mortgage, loans, credit cards bills, utility bills and many more.
One can easily enter in the Scottish trust deed; however it has some pre- requisitions as well. Apart form the finical conditions, residency of Scotland a person has to agree to the terms and conditions of the deed as well. The tenure of the agreement is a fixed period; which is 4 years most of the time. trustdeedcalculator.co.uk work on the systematic approach and once a borrower consults the IP and they agreed to be the trustee then the financial condition of borrower along with the monthly payment plan is decided. This step is quite critical and important in the deed as it will secure the borrower from any legal action against it debut. The trustee has to pay one single monthly payment which will replace all other payments that a borrower owes to the creditors. Once the payment is done and borrower signs a Trust Deed, the IP sends a proposal to the creditors along with the necessary details such as the amount proposed to pay, the value of assets and how much can the creditors gain back during the entire tenure of the Scottish Trust Deed. Within five weeks; creditor has to responds back to the registered IP and in case of approval the next step will be processed.
Once the proposal is accepted by the creditor the information is submitted in register of Insolvency and within next seven days the necessary information is disseminated to the relevant people. Now the trust deed is protected and borrower is free from any legal action and the asset is secure from any issues. Now the process will be established between the trustee and the borrower only and the plan for the repayment is established between them. However it is worth to note that if there is huge equity on the home/ car loan; it is under the possession of the trustee. After completing 48 months of signing the Scottish Trust Deed, the borrower gets freed of all remaining debts and then only they can take back the possession.