Welcome to the forum trustedhibee.

A trust deed only writes off the debt that you cannot afford to repay.

If your financial situation improves then debts will be paid in full and you'll also cover your trustee's fees. To add to this, you'll pay interest on the debts as well (as you almost certainly would have done if you had not entered a trust deed).

I think it's probably the interest which is leading this total figure to be higher than you expected. Your trustee will be able to confirm if this is the case.

Hi trustedhibee and welcome to the forum.

As TDA has advised the Trust Deed will write off the debt you cannot afford to pay back in the period you are in the Trust Deed and if things change you can end up paying back more.

I’d email or write to your Trustee to ask for a breakdown on their fees and costs and also the statutory interest than can be applied. Explain to them your concerns and ask them to confirm everything in writing.

What has changed in your financial situation for your payment to jump from £95 per month to £375 per month? Do you agreed with their assessment that you can afford to pay more? If you don’t think you can afford this payment then ask your Trustee to review your budget again to make sure everything has been covered thoroughly.

Thanks for the help guys.
Has there ever been the option to end a trust deed amicably? Would a trustee discharge a client if asked? If I stopped paying it, would my wage be arrested or worse bankruptcy?
I think I could clear my debt quicker myself now that I am in a strong financial position.

Hi trustedhibee.

By law a trust deed runs for at least four years unless the debt, fees, and interest are paid in full before the four years has passed by. This isn't a matter of trustee discretion.

If you stopped paying then a wage arrestment or bankruptcy are two possible outcomes that could follow.

Sorry that this will not be the reply that you'd have liked to receive.

Are you able to describe how a wage arrestment or bankruptcy would work? I understand that the amount is based upon disposable income but I work extremely hard for my money and feel that if I am paying out all disposable income then all it will lead to is me falling into the same situation again.

Hi again,

A wage arrestment would involve your trustee getting your employer to deduct the amount that they calculate you should be paying into your trust deed, directly from your pay, before it reaches you.

Bankruptcy would involve paying your full disposable income over for four years. That would be 48 payments versus the 22 that you have remaining on your trust deed at the moment.

Does a wage arrestment in Scotland have a limit on it related to earnings?
After recalculating income and expenditure the amount I have to pay has went up to 536. This is outrageous. If I paid this amount myself every month I could pay off my debts in full.
Is there no other options I can take?

Hi trustedhibee

Sounds like a bit of an unfortunate situation you find yourself in. There is a limit on how much can be deducted from your earnings, and it's dependent on how much they are. I'm not sure of the exact amounts, but if you go to the Citizens Advice Scotland website I think there's a table outlining the different amounts.

Unfortunately, as TDA has already mentioned, it's not your Trustee to blame here, they are only following the legislation that has been drawn up to supervise trust deeds. This means that unless you can pay the total debt, plus interest, plus the Trustee's fees and outlays, you'll have to remain in the Trust Deed for at least 48 months. The extra interest charge, as TDA has said, is to compensate for the interest lost out on by your creditors.

I'd go back to the Trustee and try and find a way that you can complete the Trust Deed successfully. You don't want to stop paying and end up being made bankrupt, or even your Trust Deed failing, and you'll be back where you started and those 2 years of payments were for nothing.

Hi my trustee arrested my wages for the full payment amount even after i sent proof several times that i no longer had the means to meet payments after a reduction in my income .

How would It be possible for the full amount of payment to be arrested?
Can anyone give advice regarding the process involving non payment? Would the trustee be more likely to fail the trust deed first or arrest wages or petition for bankruptcy?
I feel that going back to square one would be alot better than possibly spending 12k for a series of loans that cost me 5.9k

Hi Marieh38,

I don't think anyone here is going to defend that. A trust deed payment should clearly always be based upon affordability.

Hi trustedhibee,

We can't tell you what your trustee would do. They'd make a decision based upon the facts of your case.

They do have obligations to your creditors though; obligations which you voluntarily gave to them.

If you're refusing to make a payment that is due, according to a legal agreement that you voluntarily entered into, it seems pretty likely that they'd look to protect the interests of your creditors one way or another.

Hi trustedhibee

From experience, the likeliest first step would be for your Trustee to arrest your wages if you fail to make the payment that has been set for you based on your affordability. If, for example, you changed jobs and your Trustee wasn't made aware of your new employer, they would then look to either make you bankrupt or fail your Trust Deed. The Trustee's main priority is to ingather as much for your creditors as they possibly can, so making you bankrupt or failing your Trust Deed would be a last resort. Of course, different firms have different procedures, that's why the best option for you is to get in contact with your Trustee and work with them to find a way forward that is best for everyone. However, if, based on your income and expenditure, you can afford the higher payment, their hands are pretty much tied. They have to follow guidelines set by the government when calculating your expenditure.

What happens in the situation that I am paying creditors back in full (plus interest) , paying trustee fees in full? This is the part I cannot understand. Where is money going after these amounts are added together?