Hi toomuchdebt,

It would be normal for sequestration to follow a trust deed rejected by creditors.

Please don't worry about this too much though; the vast majority of Trust Deeds do become protected and Mark's comments in this thread are hopefully a source of reassurance to you?

Toomuchdebt - my total level of debt is very similar to yours, and my monthly contribution is currently ?ú700.

According to the documentation I received when the TD was set up, the dividend for my creditors is expected to be 26p in the pound.

36 payments of ?ú700 = ?ú25,200. 26% of ?ú55,000 = ?ú14,300.

?ú25,200 - ?ú14,300 = ?ú10,900 worth of fees....that seems unbelievably high.

Can any of the experts confirm if I am I working this out correctly?

Hello imcville,

Was the payment set at ?ú700 from Month 1 of the Trust Deed and the figure of 26% provided at the same time?
If so your calculation seems correct.

You could approach your IP and ask for a breakdown of the costs if you are curious to be certain how this is working.

Yes - my contribution has been ?ú700 since the outset, and the dividend of 26p was confirmed in the documentation I received when the TD was initially set up.

I also paid an initial instalment of ?ú700 (in cash) on the day I signed the trust deed, which apparently was to cover the firm's costs.

Starting to think that either I or my creditors are being seriously ripped off here?

Hi again, if you take into account my monthly repayments are ?ú350, considerably smaller than your own, I think you can see why I am currently examining all literature with a fine tooth comb. My pot at the end should contain ?ú18k (this includes ?ú6k equity ) trustees receive ?ú8k, creditors share ?ú10k. Sadly,this appears to be quite legal.

I think we need to be a little careful on the subject of fees.

I recognise that these are large sums of money but the amounts were accepted by the creditors as being reasonable. They could have rejected the Trust Deed had they felt that the charges were too high.

Fair point TDA. If the fees are indeed legal and considered reasonable then that will be that.

Bottom line - in a TD, I'm only paying back half of what I previously owed to my creditors, and I'm debt-free in 3 years. How the money is divided up is for the trustee to worry about, and I should think myself lucky that this option was available to me.

I think there's two sides to that imcville. You faced up to the fact that your debts were no longer under control and decided that you were prepared to make some financial sacrifices for three years to repay what you can to your creditors. That's to be applauded.

TDA I fully accept your point regarding fees and do not widh to bring about too much negativity on the subject. However, the amount of mistakes my trustee has made on paperwork is appalling and at a rate of ?ú90 per hour on average I fully expect a lot more ie. my moneys worth. 2 examples - The make, model and registration of the car on my TD is NOT my car details at all-they obviously belong to someone else- data protection act at its worst. The last letter I received from them quoted we were 24 months into our TD, when in fact we were 12 months into the TD. I could go on, but I think my point is clear. There is a very small percentage of people in Scotland drawing a wage equivalent to that of our trustees, the least they can do is get it right!!!

You make a good point eoin8008.

Anyone who charges significant professional fees should expect to be held to high professional standards.

This forum is full of real stories from people who have experienced widely varying levels of service and professionalism from the people they chose to handle their Trust Deed.

Choosing a firm to handle a Trust Deed is a major decision. We're very proud that Kevin and Mark choose to represent each of their firms on this site and that they give their time, often outside of working hours, to provide advice to our visitors.
We've received great feedback from our visitors who have contacted them. To me this further shines a light on the firms who regularly receive poor feedback here.

Simple message really. Anyone considering a Trust Deed needs to choose carefully. There are many many good Trust Deed firms in Scotland. A few need to raise their game.

Hi All

fees are examined closely by the creditors.

The Insolvency Exchange act for a large number of creditors and would object at the level of fees stated.
You can also object to the fees on receipt of the fee circular and have the Accountant in Bankruptcy audit
the files.

Mark

Again, apologies for bringing negativity to this subject. However, a TD is usually a last resort after all other avenues have been explored. In simple terms you either get a TD or face bankruptcy. Creditors WILL be aware that if you go bankrupt they can say ta-ta to their money. If you sign a TD however, they have their best chance of recuperating some of their cash. In their eyes, Trustees costs on a TD are irrelevant, cos if theres no TD, theres no cash for them! As for complaining about the fees after the Td is protected (which is when most of us do look at them)information I received from insolvency.gov this week clearly states "authorising body cannot intervene directly in individual insolvencies; nor can they give directions in relation to the conduct of individual cases, or REVERSE or MODIFY a decision of an insolvency practitioner". Question is-who CAN intervene?

I'm not sure that's correct eoin8008. In bankruptcy an individual would still need to make payments for three years if they can afford them as well as contributing their assets. That's likely to create a dividend for creditors in many cases.

A Trustee certainly can be held accountable for poor conduct by their regulating body. All of the Trustees that I know are very concerned to maintain compliance with rules and guidance.

I'm not sure if the website you mention is referring to English insolvency laws eoin8008, or maybe the information is out of date, but it is certainly the case in Scotland that insolvency practitioners can be directed by the Accountant in Bankruptcy and are accountable for the way they administer Protected Trust Deeds.

I guess the problem with fee levels is that when a high fee is being charged (and the figures mentioned earlier in this thread do seem rather high), then you should at least be entitled to expect a very good level of service. If not, then such fees are very difficult to justify. The firm I represent prides itself on its professionalism and quality service, but at the same time keeping fees down to a reasonable level - which is how it should be. I am sure that Mark's firm is exactly the same in this regard too.