If you've read our guide to trust deeds and think a trust deed is right for you, find out what the next steps are.
Get temporary relief from creditors (moratorium)
If you're thinking about a trust deed or any other debt solution and you are under pressure from creditors, you may able to apply for a moratorium.
It's temporary relief from your creditors which stops them taking further action against you for 6 months. For example:
- arresting your wages
- taking any possession
- starting any new court action, such as possible bankruptcy
You should check with a money adviser if a moratorium is right for you. You can apply yourself or through a money adviser.
Find a money adviser
It's important to speak to a money adviser who will check if a trust deed is right for you. There are other debt solutions that may be better for your circumstances. You can get free advice from an approved money adviser.
Find a licensed Insolvency Practitioner
Contact a licensed Insolvency Practitioner (IP). Your money adviser might be able to recommend one to you. They're the only people who can arrange a trust deed and they'll be your trustee. The trustee is someone qualified to manage your trust deed. IPs are regulated by law and must be members of an approved governing body.
They'll give you advice about what happens when you sign a trust deed. They will also tell you about the alternatives to a trust deed.
Working out what you can afford to pay
The IP will work out how much you can afford to pay after paying your essential costs. They will use the Common Financial Tool (CFT) to work this out. All IPs and money advisers use the same CFT to work out how much you can afford to pay towards any debt solution.
If you're married, the trustee will ask for details of your full household income.
You'll need to give them copies of your:
- bank statements
- pay slips
- benefit award letters
- household bills
They will also need a full list of all the people or companies you owe money to and how much you owe.
The IP will also ask you about your assets, especially if you have property or a car.
Get a trust deed proposal
The IP will produce a trust deed proposal. This will have details of your repayment plan. You should read this carefully before signing and returning to the IP. They will then send it to your creditors and ask them to agree to the trust deed. They have 5 weeks to reply.
Getting a decision
If your creditors agree, or do not reply within 5 weeks, your trust deed can be sent to Accountant in Bankruptcy (AiB). Your trust deed will only be protected once it has been approved by AiB.
Your trust deed cannot be agreed if:
- more than half creditors object
- creditors making up one third or more of your debt object
If this happens the IP can work with them to try to reach an agreement. If they cannot come to an agreement, the trust deed cannot be protected.
If your trust deed is protected
A notice will be added to the Register of Insolvencies (RoI). The RoI is a public record that anyone can access. This is also available to banks and credit reference agencies.
Your trustee will let you and your creditors know that the trust deed has been protected.
If a creditor contacts you directly after your trust deed is protected, you should tell your trustee.
If your trust deed is not protected
If the trust deed is not protected, you’ll continue to owe money to your creditors.
Your creditors can take you to court to get back the money that you owe. They can also ask the court to make you bankrupt.
If you disagree with the decision not to protect your trust deed you can appeal to your local Sheriff Court. Your Insolvency Practitioner will tell you how to do this.
Your Insolvency Practitioner or money adviser can also give you information on other debt solutions.
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