Welcome to the trust deed forum twh1.

I'm assuming in my answer that you haven't yet started any kind of debt solution such as a Scottish trust deed. If you have please let us know.

If you proceed with a Scottish trust deed it will take into account all of your income and expenditure.

If the casual work you're doing is sporadic and the income is unreliable it may not be factored (or may be only part-factored) into your monthly trust deed contribution. That way you'd have the comfort of knowing you'd be OK if the casual work were to reduce one month for example.

However your trust deed would be reviewed from time to time and any excess earnings you have received (over and above the expected amount) may then have to be paid over on top of the usual payments.

Depending upon the nature of the work, the sums involved and your unique circumstances it might be the case that you're allowed to keep a proportion of any extra income earned. This would be to give you an incentive to earn extra money and also benefit your creditors at the same time. This would need to be agreed before signing the trust deed and you should get it clarified in writing as well.

Thanks for the reply, no I've not yet entered into a trust deed and am not sure if its the way forward for me . I owe nearly £20000 between two credit cards and an overdraft and have been managing , just , to keep every one happy , even if my outstanding balances only drop by £5 per month !! However , like everyone else here , the cost of living is shooting up, the minimum payment required each month is shooting up and its getting where I just cant keep going ! However , if the deed will take into account everthing I earn from the casual job then there really is no point in carrying on with the extra work , is there ? The work is reasonably regular but might be one day this week , three days next week , it justs depends. I dont think my earnings have dropped below £100 per month , but its never more than £250 per month !

Hi twh1.

The answer to your question really depends on your circumstances and what, if any, debt solution you elect to proceed with.

The Debt Arrangement Scheme and debt management plans might be considered to be less serious options to select that a trust deed for example, but both require full repayment of the debt. Additional earnings could therefore reduce the repayment term massively.

A trust deed will require a minimum level of funding depending on the debt total and the fees of the trust deed company itself. Depending upon your circumstances you may (or may not) need some extra income to make a trust deed an available and viable option.

Depending upon the circumstances and the attitude of the trust deed provider you may also in some circumstances be able to retain a proportion of extra earnings. That could make managing your finances through the term of the trust deed much much easier.

I do see where you're coming from, but it's probably a decision you would only really want to make having actually worked through everything with an adviser and then taking a little time to weigh up what's going to be best for you.

Thanks very much for your help. I'll take your advice and arramge to see someone , thanks again

Hi twh1

What are you paying to your debts now, and what do you believe you can realistically afford to pay every month? This additional information will help us point you in the right direction.

Julie

sorry , for the late reply , at the moment I'm paying £230 to £240 for one credit card , and £140 to £150 per month to the other ! My monthly overdraft costs at least £30 a month . Thats the easy part , I'm also paying £200 per month for a car on HP and £166 per month for a loan which is in joint names ! I clear £1500 per month plus what I earn from the casual job .

Hi twh1.

If you were to add up all of your necessary expenditure how much do you think it would total each month?

This figure would include mortgage/rent, council tax, utility bills, food, travel, clothing etc. It would also include the car HP payment (but not either of the credit cards, the loan or the overdraft).

The idea is to get a sense for how much you could afford to pay to a trust deed or debt arrangement scheme if you were to proceed with one.

At the moment I reckon I'm paying around £1250/£1300 per month without paying the credit cards or loan !

Hi twh1 and thanks for the information.

Using that information it looks as though, if you gave up the extra work, you might be able to pay £200-£250 per month into a trust deed. I'd have thought that would be sufficient to make a trust deed viable though this will depend upon how much any trust deed provider you choose proposes to charge in fees.

If you were earning an average of £150 per month from the casual work, you might be able to pay £350 to £400 per month into a "debt arrangement scheme". With debts of £20000 and a monthly payment of £400 it would take a little over four years to clear the debts that way.

The casual wortk may therefore be useful in providing you with an alternative option to consider that would have taken a lot longer to complete otherwise.

The debt arrangement scheme would generally be considered to be a less serious step than a protected trust deed, though of course all of these solutions should not be taken in any way lightly.