Hello greigthom13 and welcome to the trust deed forum.

I'm sorry to hear that your daughter is having a difficult time at the moment.

It's very good news that the trust deed is now protected. No unsecured creditor can now take any legal recovery action against your daughter. If any creditor chases her she should inform them of the protected trust deed and point them towards her trust deed company. There may be some contact while the creditors update their records, but it should die down over the coming weeks all being well.

The amount that your daughter pays each month should have been calculated by working through her income and expenditure. It shouldn't in any way be influenced by the amount that the trust deed provider is charging in fees. In this respect, even if their fees were lower the monthly contribution would likely be the same.

I would think that your daughter should have been made aware of the fees before signing the trust deed though; it does affect the return that her creditors will eventually receive and therefore potentially their willingness to accept the trust deed.

As the trust deed has become protected it would seem that the creditors consider the proposed fee level to be acceptable. Do you have any detail on how much it will add up to in total?

Sorry to hear a horror story Just as Im able to think long and hard about going down the TD route, I asked the question to the TD company reference payments and amounts paid to creditors and the TD company and was told that the first 2 installments paid are withheld by the TD company for fee's and the rest of the 3 years payments to the creditors....is this not right? have I been fed duff info already

Markymark, there is no need to pay any admin fee at all, when I first considered going for a Trust Deed the 1st company I went to said that they would take the first payment as an admin fee. But doing some searching online and finding this forum I realised that there was no need for extra payments. My 36 payments I make to my trustee include all fees......

My advice is speak to a IP who does not charge a uneccesary admin fee, money is to tight to make unneeded payments....

Thanks porcupine, learning new things each time I read this forum, giving me loads to advise to help ask the TD company the right questions when we meet.

thanks again.

Good points made by all.

Unfortunately the costs associated with arranging and running a trust deed do tend to add up to a fair amount over the piece. After all, a trust deed has to be administered by a highly-qualified and licensed insolvency professional and it is not a one-off transaction but a three-year period involving regular work. When compared to the fees you are likely to pay a solicitor for a one-off transaction such as buying a house then it doesn't seem such poor value.

In any case, ultimately it is the creditors that are bearing this cost as the person entering the trust deed is merely obliged to pay whatever they can reasonably afford each month, it is the creditors who are writing debt off and agreeing to the level of fees involved. They have an understanding of the work involved and judge whether to accept the proposals based on this knowledge. As Trust Deed Assistant said, if they have accepted the proposals then it is safe to assume that the costs are fair and they are happy to bear them.

The subject of upfront fees is another issue altogether and Porcupine is spot on - there is no need to pay an upfront fee to set up a trust deed. These fees are invariably charged by middlemen, not the insolvency practitioner themselves, and can be avoided by approaching an IP directly.

Hi greigthom13

As detailed above, the contribution is based on income less expenses and shouldn't be directly linked to fees. There is also VAT and the Trust Deed outlays to consider.

Markymark, I am surprised that KPMG made the statement re the 1st 2 payments as effectively your Trust Deed is now 38 months long or longer I suppose depending on things. Did they make the statement or was that via a middleman company.

Mark

Hi Mark, Sorry it was Debt free Direct that first mentioned the typical 2 fees, KPMG then called me and have not said anything yet ref fee's, again sorry for the mis-information.

Hi markymark.

Any extra two "fees" isn't something you'd need to pay if you went direct to a trust deed company. It also wouldn't need to be paid via a considerable number of intermediaries including, for example, the CAB or a Money Adviser. In short... there is no need to pay an extra two months in fees!

The fees for a trust deed will be taken from the agreed monthly contributions which will (usually) be agreed to run for 36 months.