Hello Gill1979 and welcome to the forum.

That's probably an issue to discuss in advance with any potential trustee that you might use.

It's really impossible to give you a useful answer here as the way its looked at could vary a lot depending upon the precise circumstances and the reasons that you based your choices upon. It's even possible that different trustees might interpret things in different ways.

I think the key points now are probably:

1 - Get some advice to confirm that a trust deed is potentially a useful way to deal with this situation.

2 - Decide upon one or two trust deed providers to have a chat with.

3 - Speak with someone senior at the firm rather than a regular telephone adviser. Be very open about what has happened in terms of the property. This is a bit complex compared to most cases so you'll want to:
A - Speak to someone with the authority to make decisions.
B - Get everything clarified in writing before you proceed so that you're reassured about how things will progress.

Hi Gill1979

TDA has got it spot on. Any trustee would need to look at a number of factors to decide if this was challengeable, however this is definately something you should fully discuss before signing anything.

The worst case scenario would be an action to recover the sum paid. It's complicated if she was a valid creditor as the time limit for challenging reduces from 5 years to 6 months.

Mark

Can you elaborate on the 5 years 6 months thing? She have me a loan years ago to pay off old debts of £20k and I needed to pay it back!

Hi Gill1979

Very generally there are 2 action which a Trustee can raise, An Action of Reduction (Section 34) and and action against an unfair preference (Section 36).

The 1st is when someone who has signed a Trsut Deed or been sequestrated disposes of assets to avoid creditors getting these. ie transfers one half share of a property for no money etc. This can be challenged within a 5 year period prior to date of sequestration/date trust deed signed. The 2nd is when one creditor is paid(preferred)before another. The Trustee can raise an action within a 6 month period prior to date of sequestration/date trust deed signed. ie any transfer which took place more than 5 years cant be challenged for the 1st and any transfer/payment which took place within 6 months prior to date of sequestration/date trust deed signed can't be challenged.

This is a very rough summary and there are a lot of factors and defences for these, so it would wholly depend on the circumstances and other factors.

Mark

What would I need to show my mum was a proper creditor? Also if they said she wasn't then would she need to pay it all back even though she's used most of it

Hi Gill

I think if she can provide details of the funds paid over ie bank statements etc then this would be a start. If the money has been used then the trustee needs to assess if its worthwhile to pirsue this taking account of costs etc if it produces nothing.

Mark

Thankyou I will look into what paperwork we have to verify this before I make any decisions as I don't want to burden my mother with anything!

Hi Gill

Its always a wise move to gather as much information as possible as this makes it far easier to piece something together for creditors. The more information, the better.

The trust deed is a proposal to creditors based on all of the information, which allows creditors to make a decisions based on their own criteria and the advice of the trustee in the proposal.

Mark