Hi Zeaus1976.

I do like being asked questions, which is why I answered all of yours.

The asset surrender isn't temporary, it's part of the proposal put to your creditors to help repay your debts. If you own significant assets at the start they'll need to be used to help repay creditors normally.

Trust deeds weren't introduced to prevent insolvency. They're a type of insolvency.

They also weren't introduced to prevent the loss of homes. Depending upon circumstances they might have this effect, but if you have a lot of equity the opposite can be the case.

They key question to ask your trustee (the only person who can give you a specific answer) is what happens at the end of those two years if it's extended. Are you discharged? Or do you still have to deal with the balance of the equity that existed or now exists? I think everyone here would urge you to get that answer in writing.

Presumably the Trustee would have to agree with the Creditors, in advance, that the two year extension was acceptable enough to 'write off' the Equity.

Hi Zeaus1986,
I agree with you that this trust deed business is looking very suspect indeed, I've never known such an industry that allows individual companies to interpret the rules or how they want to play them, without any real regulation, but please don't despair as I'm just off the iva forum and have read some of the comments related to trust deeds and iva transfairs, and truly believe that not too soon these companies and individuals will be dealt with by the relevant regulators very soon indeed, unfortunately this doesn't help your situation now, the very important thing for you to do now is contact your new trustee and come to some sort of arrangement in regards to your equity, get it in writing just like the TDA says, stay on the ball with this and get something sorted, there's nothing worse than feeling that you may lose your house, I also feel maybe a trust deed was not the right advice for you those few years ago when you took it out as you had such large equity, maybe the experts here would have suggested an alternative but hey it's done now so good luck in getting something sorted, please let us know how you get on.

Hello Tallhotblonde.

There's plenty of control and regulation over trust deeds. The applicable law is made by politicians, the AIB oversees the process, trustees are monitored closely by the professional bodies of which they must be a member, and serious sanctions can and do follow malpractice.

I see where you're coming from regarding interpretation of the law, rules and guidance. This does create scope for inconsistency and confusion. It's really no different to many other areas of professional life however. The sheer enormous variety of possible scenarios makes it impossible to have a law or a rule for each one meaning that a professional has to use their training, experience and the applicable rules/guidance to make a decision.

Take for example a judge making a sentencing decision, a doctor interpreting a set of symptoms, a police officer choosing to arrest or warn someone who has stepped out of line, a manager having an informal word with an employee or putting them in a disciplinary process, a bank deciding whether or not to lend to you, or a health and safety manager temporarily shutting down a site while a problem is resolved. All situations where a trained person has to use their judgment rather than just following a precise set of rules. Most of us probably have to use our professional judgment rather than a rule book at work sometimes in ways that have consequences for others?

Hi Diamond Chap.

If the sum paid was significantly less than the equity, or significantly less than offered in the proposal that was accepted by creditors, I think you're correct.

Hi folks, I think for the purpose of the forum that we shouldn't make suggestions that may discourage people from looking a Trust Deeds as a viable option as with the right advice for the right people they can provide near instant relief from a bad situation. I do agree however that industry in the past was full of ifs and buts, and there is little doubt that some companies have perhaps painted a picture that's not quite right. I heard an advert on the radio yesterday advising people who may have been mis sold debt repayment plans to come forward for compensation. I don't imagine, given the hefty 'write off' that we have seen on our own debts, that there will be much in the way of compensation for us is a similar scheme were to be put on place for trust deeds. However, I'd like to think that this is a sign that things are changing within the industry.

Ally

If you are considering a trust deed and have significant equity,sign nothing until you are 100% sure of what will happen!! It worked for us as we had little equit.

Paul

Thank you to SkintAlly and plasticdaft for two very good points.

Protected trust deeds are a very good option for some people. Other options make better sense for other people.

It all comes down to circumstances and priorities.

It also comes down to finding a genuine source of professional advice at the start rather than a salesman. I appreciate that this can be hard when people are in a desperate financial situation so it is good that marketing rules, and the monitoring of adherence to them, have been tightened up in recent years.

Meant to add, dont just go to one source for advice,approach 2 or 3 different sources and see what all say before making any decisions.

Paul

Hi,

You make a good point SkintAlly. If set up correctly and for the right reasons then a Trust Deed can be a very effective way of dealing with an unmanageable amount of unsecured debt. It writes off the debt that you cannot afford to pay and this can in some situations can be a very large percentage but in other situations this may not be a large amount but you are still writing off debt.

I've just looked at the statistics and for 2013/14 a total of 6,681 people entered into a Protected Trust Deed. From my time being involved with the forum I have found that the forum does tend to attract people who have encountered a problem with their Trust Deed and are looking for help and advice. For a significant amount of people their Trust Deeds run smoothly and without any problems.

Zeaus1976 ÔÇô Have you picked up the phone to your Trustee and clarified what happens now regarding your Trust Deed and the equity? Your Trustee might give you a very straightforward explanation and way forward on how things will work.

To answer your question ÔÇ£Q) We were informed we can extend the TD by two years(by continuing the agreed amount)and this would write off any outstanding debts. Is this correct?ÔÇØ

I am aware that if a client has more unsecured debt than equity in their property then a proposal can be made to creditors at the outset of the Trust Deed that at the end of the 3 or 4 year Trust Deed term a client can extend their payments by 1 or 2 years and pay over a proportion of the equity in their property in full and final settlement of the available equity. I believe this may be how it works with IVA's and equity down south. This proposal needs to be made at the outset to creditors though so it's key to find out what the original proposal was in your Trust Deed. My firm has actually proposed a small number of Trust Deeds to creditors on this basis this year and they have all been accepted.

With your case, if your Trustee has confirmed in writing to you that by extending your payments for an additional 2 years it will deal with the equity in your property and your Trust Deed will then be discharged then this is how things should work. The confirmed in writing is the key bit.

Once you have spoken with your Trustee and if you would like further advice from me I'm happy to try and help and I'm sure others on the forum will be as well.

As plasticdaft has pointed out people should consider speaking with a couple of advisors from different firms to find out as much information as they can. It's something that all of the experts on the forum always tell people looking for advice on dealing with their debts to do. I do appreciate that when someone is struggling financially and someone offers a lifeline to deal with this then they put their trust completely in that advisor and the information they have supplied. As we have learned there are companies with ÔÇ£salesmenÔÇØ who will try to explain how a Trust Deed works but in actual fact they don't have any experience or Insolvency qualifications and just refer onto an Insolvency Practitioner. The Financial Conduct Authority changes that are coming into force should help to drive out the unregulated ÔÇ£introducersÔÇØ and ÔÇ£salesmenÔÇØ operating within the industry. Like everything in life it evolves and develops and improves and our industry is certainly doing that.

Hi Zeaus1976

Can you advise what the total level of debt was and what the total monthly contributions were?

If you have still have a copy of the original paperwork, then you will have received the proposal received by the creditors and this may clarify the 2 year extension part. If the statement of affairs shows the £60k on the basis of the valuation being instructed and the mortgage redemption being provided, then it's unlikely that the 2 year extension will be sufficient however.

You mentioned that you were advised that the equity was frozen at the start and you have subsequently been advised that this is not the case. can i ask who advised you of this?

Mark

Yes these trust deeds are better organised now TDA but prior to the new rules ie sept 2013, im afraid its looking decidedly uncertain for many people on this forum in relation to the ever fearsome equity question,i do hope that these fears are unfounded and that those who have had their trust deeds sold off to another company can look forward to a trouble free process but my instincts are telling me something different, i just hope im wrong!

I take on board all the comments here . Trust deeds are ideal for people with no equity and people in this position should consider then.
TDA I sought advice from "a genuine source of professional advice at the start rather than a salesman" He stated 100% I should not worry about my home as long as I could make payments and I would have no trouble getting a re-mortgage. At a very vulnerable time .

I have made additional payments totalling 50% of the equity and I am still facing the prospect of losimg my home early next year.

Lenders will not lend to me, It was the same 3 years ago so why was I allowed to continue ??

Its safe to say nobody knows what the mortgage market is going to do in 3 years time so its wrong to advise people of something you cannot guarantee!!

Paul

Hi Tallhotblonde.

I think those that recently had their trust deed transferred can look forward to their agreement at the start being honoured, just like the new trustee announced that they would be. We've seen nothing firm to the contrary of that.

I'm not sure where the new rules come in to this. Mark's firm (and some others) previously measured the equity at the start of the process and fixed it at that point. The new rules mean that all firms are doing this now.