Do I qualify?
Here is an example of how a Scottish Trust Deed could make your debts affordable:
Let say your unsecured debts
looked like this...
Total Owed £28,000
After a Scottish Trust Deed...
New monthly repayment is based on affordability and varies from plan to plan.
Visit our FAQ Section for any in depth information on Scottish Trust Deeds
So when you find out about debt management solutions Like Scottish Trust Deeds your first instinct is that it will sort everything out and all your debt will be included, but often this isn’t the case. In the murky world of debt there are only really two types of debt – unsecured and secured (although sometimes there is a third type that is neither) – but only unsecured can be included in debt management solutions.
But do you know the difference?
Unsecured debt simply means that if you default and don’t pay the debt the lender doesn’t have any kind of physical security they can fall back on to pay off the balance that you owe, such as a property it could automatically force a sale on or a person it could insist will pay for you. They can however chase you for payment and perhaps even try and take you to court, maybe even have you sequestered, but it’s a drawn out unpleasant process, and often they prefer not too as the costs are too high compared to what they may get back.
Unsecured debts include the following:
Any type of credit that assumes an automatic right to claim an asset or force someone to assume your payments if you default is a secured debt. Some home loans are secured against the owner’s property while some loans require someone – a guarantor – to agree to pay on your behalf if you fail to pay.
Secured debt includes:
However, you may not realise that there is also a third type of debt that is neither secured nor unsecured, but will not be included in debt management solutions such as Scottish Trust Deeds.
They are not secured against anything, but will not be allowed to be included:
Most people have an idea, but if you have been struggling financially for some time under the weight of charges and interest, it might have got out of hand and be more than you think. Alternatively, perhaps you’ve just stopped opening your mail and try not to think about how much it could have increased to. Before you apply for something like a Scottish trust Deed however you will need to know exactly how much you owe to who.
Step 1 – Make a list of unsecured creditors
Against the name of each creditor, write how much you owe them and how much you currently pay. It might be useful for you at this point to write down your account number so you have the information to hand.
Step 2 – How much do you owe them?
This is probably the hardest bit. You might need a big pot of tea or may even a glass of something stronger. You have to gather together all of your financial paperwork and find your most recent statements. If you have a big pile of unopened mail now is the time to take a deep breath and open it. If you have thrown most of the paperwork away, you may need to ring and speak to the lender or register to set up online access through your lender’s website. Next to each creditor, list the balance you owe them and what interest rate you are being charged including the loans. For loans it would also be useful to have the date that the loan is due to end.
Step 3 – What’s the total?
Deep breath time...
Add up the column with all the outstanding balances. This might be the first time you have done this for a long time so you may be very shocked, but whatever you do don’t hide all the paperwork away and try to ignore it.
Pick up the phone and call one of our advisers at Trust Deed Scotland for a confidential chat about your options. It might be that a Trust Deed will work for you, but if not they have plenty of ideas on how you could tackle your debt quickly and get your life back on track.