Welcome to the forum Andy1957.

You'd need to contact your trustee to confirm the details here. However, the trustee would be looking to capture a sum that covers the debts, interest on the debts, and their own fees.

If your lump sum will be much more than the amount needed to cover the above then the trustee might show some flexibility about how much they initially gather in. Only your trustee can tell you how long it might take to return any surplus funds to you.

The trustee's fees are likely to be reduced I'd have thought (in comparison to their estimate for managing the case for four years) but again this is information you'd need them to provide to you directly so you're sure about where you stand.

I would have to disagree with TDA slightly here, and say it would be a little more complicated than that.

Your pension would likely not be classed as an acquired lump sum, but would still be classified as income which would not automatically vest with a Trustee. Calculations would therefore require to be carried out to determine how much of the pension would require to be remitted but it is likely any reduction to your monthly income could be offset.

For example: you earned £1,000pcm currently, monthly pension payments would equate to £500, therefore £500 could be retained from the lump sum per month for the remainder of your trust deed - of course you would be required to pay contributions from that income, so in all likelihood you could then deduct the remaining contributions from the lump sum you could retain.

That is one way of looking at it, Voice of Reason, but unfortunately may not be the way that the trustee in this case sees it.

I would suggest you speak about this with your trustee and get any agreement in writing with them before going ahead and taking your lump sum, Andy1957.

I contacted my trustee and was told that due to changes in legislation in2013 that i cannot pay a lump sum payment and should continue my payments as normal even after retiring.I asked for this information in writing and was told they don't send letters with this information. Can you advise me if this is so my trustee is credit fix .
Thanks

Hi Andy1957.

The rules did change in terms of the only way for the trust deed to be completed early would be to repay the full debts, interest on the debts, and the trustee's fees.

Before that people could sometimes negotiate early settlements funded by third parties, perhaps equivalent to their expected remaining contributions for example.

If the lump sum is large enough I cannot see why your trust deed cannot come to an early end. There again, if you don't take this lump sum perhaps you'll be a lot better off in the long term.