Hi Pinkveggie.

Any answer we give you on this will also be hazy. Your trustee is the person who will have to make a decision on how to deal with this and is therefore the only person that can tell you.

The trust deed failing is certainly a possibility, though forcing your sequestration seems less likely.

It may be that sequestration could be the most suitable way forward for you. Hopefully your trustee will discuss the possible ways forward fully and work with you to get the best outcome for all

hi Pinkveggie,

As TDA has advised only your Trustee can really give you an answer on what will happen to your Trust Deed if you are unable to afford a suitable payment per month.

In terms of forcing you into Sequestration, your Trustee can petition for your Sequestration which means they submit an application to your local sheriff court requesting that you are Sequestrated. If you wished to try and stop this happening then you can appear at the sheriff court and put your side of the argument across as to why you should not be Sequestrated. A sheriff will listen to both arguments and then make a decision.

The other route is for your Trustee to release you from your Trust Deed and you then apply for your own Sequestration. This would cost you £200 at the moment.

If it does turn out to be Sequestration then depending on your circumstances Sequestration can be very straight forward so it might not be something which you need to worry too much about.

A new income and expenditure would be completed with you to establish if you could afford to make a contribution or not. If you cannot afford to make a contribution in Sequestration and your expenditure isn't excessive then you would not be required to make one. You would automatically be discharged after 1 year and if you are not asked to make a contribution per month then you would be completely finished with the process. If you can afford to make a contribution, even if it's £10 per week then you would pay this for a 3 year period.

Do you own your own property or have any other assets or a motor vehicle?

Your relationship manager should be able to give you a detailed run down of exactly how Sequestration would work based on your circumstances if this is the option that your Trustee decides upon.

Thanks for taking the time to answer, I do own my property but in negative equity when TD started, I have spoken to my relationship manager but never the trustee, they said that if we could not afford to pay anything they would not fail it, i just would not pay, I dont trust this as they said they cannot categorically promise what would happen, I would lose my job with bankrupcy

If i had know any of this before i would never have went into trust deed, its like living a nightmare [:(]

Hi pinkveggie

I'm really surprised that someone from your trustees office would make that statement. The trustee has an obligation to complete the proposal set out at the start of the trust deed and if this is unable to be fulfilled, the the only options available are to either seek their discharge which puts you back to the position you were in before you signed and takes away any protection from creditors or the can sequestrate. In my experience, the 2nd option is less likely though.

Mark

Hi Pinkveggie,

I would try not to beat yourself up too much about entering into the Trust Deed. I assume at the point when you entered the Trust Deed based on your circumstances it was an option which was suitable for you. Unfortunately now due to a reduction in income and a change in circumstances it looks like the Trust Deed will not complete.

If your Trustee does release you from the Trust Deed and pass your debts back to you, normally I would suggest Sequestration as the route to consider but because of your job then this isn't something that looks suitable. Is it a guarantee that you will lose your job if you go down the Sequestration (Bankruptcy) route? Many people I speak with assume that this will be the case but when the actually look into it then it doesn't.

The difficult position you will find yourself in if you are released from the Trust Deed you will have all of your debts returned to you and I assume you will not be able to pay these due to your tight budget. If you cannot make a suitable payment to a plan i.e. a TD, DAS or even token payments then a creditor could eventually take legal action against you which can result in Sequestration.

What was the total level of your debt when you entered into the Trust Deed?

Is there anything that you can do to try and improve your household income or reduce your household expenditure?

thanks for taking the time to reply, its not what i wanted to hear but at least someone is confirming what i thought, this is a nightmare, unfortunately my health is failing which is reason things will change, i cannot even afford £200 each for sequistration, no idea what i am going to do now, I cannot see a way out of this

I have to disagree with Mark on this one - the proposals sent to creditors at the start of the Trustee are merely an estimate as to what creditors can expect to receive. By signing a Trust Deed a person is promising that they will comply with the Trustee, pay whatever is reasonably affordable depending on their circumstances for the period of the Trust Deed and convey any assets to their Trustee for the benefit of their creditors. As long as they are doing that then they are in fact meeting their obligations.

If there is a change of circumstances which is beyond your control then the Trustee does have discretion to allow the Trust Deed to continue despite creditors not receiving as much as was originally estimated. In fact the Accountant in Bankruptcy's Notes for Guidance for Trustees states the following:
"It would not be appropriate to refuse to discharge a debtor because of circumstances beyond their control, such as a change in circumstances which prevents them from paying any contribution payable...or if an asset realises an amount less than originally estimated by the Trustee on Form 3"
Pretty clear really - as long as it is beyond your control then you shouldn't be punished for that by refusal of discharge.

thanks so much Kevin, that is kind of what i was told by my relationship manager, I thank you Kevin for giving me some hope. Life is really stressful but that is good as I am trying my hardest to get this finished and I will do everything in my power to make sure it does 🙂

Hi Pinkveggie,

Whatever your relationship manager has advised you on the telephone please request that this be confirmed in writing from your Trustee. That way, if there is a problem later on down the line or a change in your relationship manager you have it confirmed what was agreed in writing with the actual Trustee.

I will try but i am thinking you dont think this will happen David? I have no blinking idea what to do, I really dont! so down about this whole thing

Hi Pinkveggie.

Requesting written confirmation of information you've been given doesn't sound unreasonable at all.

What's to be lost by asking?

Sorry if you have picked me up wrong pinkveggie. I don't think it won't happen, I just think that with something like this it's best to have it in writing.

It's your Trustee that ultimately has responsibility for a Trust Deed and how this will work. Relationship Managers are in place to handle the day to day stuff. I'm sure people on the forum have experienced problems in the past with being told one thing and something else happens.

Always best to have any decisions confirmed in writing and you then have something to refer to.

Sorry the person who told me this has now left 🙁 So never heard fromy new relationship manager and have never spoken to the trustee. I know the creditors need as much back as they can but i have honestly will do whatever it takes i hope it all works out 🙂

I honestly mean this, but we could not afford £200 each for sequestration, so if they try and force us to do this and we cannot afford it, what the heck can we do?