It would be up to your trustee and ultimately your creditors, Timelord.

There is no reason that your trustee couldn't put a proposal like you describe to your creditors to see if they would have any objections, something which we have done successfully on numerous occasions.

However, there is no guarantee that creditors will be happy to accept this offer. They would be weighing up the chances of missing out on any potential windfall that might come your way over the next couple of years by allowing you to be discharged early. Having said that, there is also the risk that your circumstances worsen in future and they would have been better off accepting this proposal now.

I think most creditors would rather the bird in the hand than the 2 in the bush though - especially if the reduced timescale reduces the administration costs so they are getting an increased dividend.

Thanks Kevin. Would there be room for negotiation?

Hi Timelord,

I would alsways recommened any proposal is put in writing to the Trustee. Unfortunately you will not be aloud a discount on the contributions as these have been agreed by the creditors and must be ingathered in full. If the proposal included equity then there is generally an angle to to make an offer on this. It various case to case and decisions are made by the case history i.e conduct, missed payments etc. It does not cost anything to ask so and it may well just be accepted. Like Kevin, I have also done similair proposals on numerous occassions. If the Trustee deems the proposal to be reasonable, then they will write to your creditors giving them 14 days to object to accepting the funds and closing the case early. No answers deems acceptance.

Pro's for creditors - quicker dividend, less Trustee costs;
Cons - less chance of any other assets coming in to the estate to boost their dividend.

Hi Rob. I'm curious about your comment on decisions on these matters potentially being made by the creditors based on the conduct of the account, missed payments etc. Given Kevin's comments on this matter I am left wondering whether the creditors would look favourably on early settlement against an account which HAS HAD missed payments, given the creditors derived level of risk for such an account would be higher than someone who pays the agreed amount every month without fail. If this is the case, does this not entice someone into deliberately missing a payment or two before then proposing a full and final settlement?

Also... this one has been bugging me for a while so I'll throw it out there... If you win EuroMillions whilst in a trust deed, does the whole seventy million go to the creditors???

Re Ôé¼millions, it would be the debt + interest + fees, you would get to keep the rest. Oh how I wish:-)

In a nutshell the answer is no. They are going to look at the dividend return, not how many payments were missed. It would generally only be the Trustee who would look at the conduct, prior to agreeing to take the matter to the creditors.

Inheritance and windfalls are deemed an asset of the estate. The Trustee would have an interest in this and would inherit the full amount. The Trustee would then pay all creditors 100p in the £ plus statutory interest at 8%, plus all the fees and costs of the estate are settled. Following this and discharge any surplus funds over and above this would be returned to you.

Thanks Rob. That all makes sense.

We had a case which settled fairly recently where someone had been made bankrupct for £3k debt, but had assets of £5m+. Long story, but there were a lot of other debts & we paid debts in full plus interest about 2 and a bit years into the sequestration and a couple of creditors commented that the final payment @ 8% interest was like sticking funds it in a very high interest savings account.

Mark

Let's say I had 2 years remaining of my TD when family were in a position to pay it off. How does it work with a car which is currently valued at +3k but would be -3k in 2 years when TD was due to expire?

I'd imagine they might see it as an asset at this point in time TimeLord (if they picked up on it of course).

What was said about the car at the start of the trust deed? That might be more important.

There's no definitive answer for that, Timelord. Again, it'd be up to your trustee and/or creditors - they may well insist on extra funds coming in in respect of the value of the car though.

Thanks guys, appreciate your guidance