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Topic starter
19/06/2021 7:49 pm
Hi guys! Sorry this is my first post so please stay with me!
I have been in a protected trust deed since October 2019. I had an amigo loan before that date. I didn’t think that I had decided to go ahead with including this in my TD due to the implications this would bring to my guarantor.
I have always put my amigo loan on my expenditure since my TD started and had enough available to pay my guarantor by standing order and they would pay amigo. I had a review undertaken this month and was told that I shouldn’t be paying amigo loans and that my guarantor had agreed to undertake the payments. My guarantor has since become unemployed etc so would be unable to make the payments herself.
I’m just wondering if since my Amigo loan is included in my trust deed - do we need to continue paying it on top? I’ve tried to contact amigo and wasn’t able to get through so have emailed but this can take days/weeks to be answered. Just wondering if anyone else been in this situation. Many thanks!
19/06/2021 9:12 pm
Hi Seachicken2111
A Protected Trust Deed will deal with your liability for all liabilities that existed at the date of signing - whether that creditor likes it or not. There is no way to exclude a debt, as they are included by default.
Your guarantor remained liable for the full balance to Amigo as they signed a contract with them, stating they would make payments if you did not.
Unfortunately, it sounds like you were mis-advised at the start of the process. You cannot be paying your guarantor whilst subject to the Trust Deed. This is known as an unfair preference - where you are diverting funds that could benefit all of your creditors, to the sole and exclusive benefit of one. Theoretically, your Trustee could refuse to discharge you, unless those funds you have paid to your friend are paid in to the Trust Deed, either by recovering them from the friend, or by insisting on a term extension to deal with arrears.
If your friend is struggling with their finances, they should seek good, honest advice about how they can deal with their debts, and the best path for them to become debt free
21/06/2021 9:34 am
Hi there -- welcome to the forum.
It really should have been explained to you properly prior to you signing the Trust Deed but you aren't allowed to leave debts out of the Trust Deed - as DBHA21 says, all of your debts are included by default.
Amigo will still expect to be paid, but by your guarantor instead, and any funds that you yourself have spare should be going into your Trust Deed for the benefit of all of your creditors.
A lot of people have had success challenging Amigo on the grounds that the affordability of their loan repayments was not properly checked by Amigo during the application process - both for the borrower and the guarantor. If you feel this applies to your guarantor then they could similarly challenge the validity of the guarantee and potentially get it removed altogether as a result.
Scottish Debt Solutions Expert - Ask me for help setting up a Scottish Trust Deed or Debt Arrangement Scheme plan.
22/06/2021 10:20 am
Morning
Just to clarify - DHA21 is correct in that Amigo is receiving a preference in terms of being paid opposed to the ones included in your Trust Deed but for the avoidance of doubt, it is not regarded as the unfair preference definition in terms of the Act.
I agree with Kevin's comments re validity of the guarantee. There is also concerns Amigo is likely to collapse this year due to being unable to agree a compensation package for customers.
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