Vicky

That is correct, no funds can be taken from benefit payments. Please ensure you have spoken to your Trustee to ensure no payments are deducted.

Your trustee will have to decide whether it is appropriate to continue with your Trust Deed. Creditors accepted the deed based on the expectation that you would be able to continue with payments for a period of usually 48 months.

If it is concluded that your Trust Deed cannot continue but to long term unemployment, your Trustee is likely to resign from office and remove you from the trust deed and in effect, you then become responsible for your own debt. There may be other solutions to deal with your debt such as bankruptcy.

P

Welcome to the forum Vicky286.

I'm very sorry to hear that you have been made redundant.

Did you receive much of a redundancy payment?

How good do you think your chances of getting back into work soon are?

Different firms might deal with this in different ways, Vicky286. As Paul says, some firms may see this as sufficient reason to terminate the Trust Deed and you would need to consider other alternatives such as bankruptcy instead.

However, as this is a change in circumstances outside of your control then your trustee should really allow the Trust Deed to continue if that is your preference, but with your contributions set to zero for the period that you are out of work. That is what the formal guidance from the Accountant in Bankruptcy suggests and all trustees should be basing such decisions with this in mind.

Hi TDA,

Yes I revived a months noticed and 3 weeks pay, I phoned to let them know and he said that was fine they didn’t want any of it but just t keep making my usual monthly payment which I intend to do.

Job wise I am not sure, there is very little jobs out there at the moment.

I do receive child maintenance which the same amount that I pay towards my trust deed, as this is not benefits could I still pay my monthly payment? Taking this into consideration as income? I want to do everything to keep my trust deed.

Yes Vicky

Child Maintenance can be classed as income and you would be able to utilise funds to pay contribution

p

This sounds like an option Vicky286.

I guess a different question is whether this is going to be affordable for you?

Paying for priorities like rent/mortgage, utility bills, council tax etc should always come first if there isn't enough money for everything.

Thank you all for your replies.
Realistically when I universal credit I don’t think I can of afford my payments

I haven’t told anyone about my trust deed, my family are great and I’m very fortunate that they have helped me out a lot over the years which is one reason why I have never told them because I know my dad would of offered to pay my debt off but I feel like a burden because he has done so much for me, I think I am going to tell him about my trust deed. So the question I have is, because I can no longer make my monthly payments because my only income is now universal credit, would my trustee accept a payment to settle my trust deed?

Hi Vicky286.

The issue here is that it might have to be a very large payment to settle your trust deed.

Your trust deed can only end early if the total paid into it covers all of the following:

1 - Your debt total at the start
2 - Interest on that debt
3 - Your trustee's fees and costs

This is likely to add up to a fair bit more than you owed when your trust deed began.

If this total isn't reached then your trust deed's minimum term is 4 years.

The total of my debt owed was £14,058. With me making £200 payment for 4 years paying back £9600.

Say my dad did offer to pay this off, surley my creditors would rather accept the total of the original debt rather than the trust deed failing and then not being able to receive any more money?

It’s not an option I’m afraid Vicky286.

It used to be possible but the Scottish Government legislated a change in the rules.

On the Scottish debt advice website under trust deeds it’s says this.
‘ If a third party offers to give you a lump sum on the basis that it is used to settle your Trust Deed early, then in these circumstances the money you receive is not considered to be a windfall.
This is because it is argued that this lump sum is only made available if your creditors agree that they will accept it to settle your TD. Otherwise the money would not be given to you.
If you believe you might have access to such a lump sum you need to discuss the amount available with your Insolvency Practitioner. They can then make the offer to your creditors.
Sensible lump sum offers are often accepted by creditors in full and final settlement of TDs even if it means that they will receive slightly less than originally agreed. This is because a lump sum means that they will receive cash immediately rather than having the risk of waiting for you to finish making your monthly payments.’

Is that not the same thing as what I mentioned above?

Thanks

It’s the same thing, but sadly the information is well out of date and incorrect.

This used to happen quite a lot but the rules got changed because it was felt unfair on people who didn't have access to a third party with a lump sum.

That's when the four year minimum term came in (unless the amount mentioned above gets paid).

This does still happens with the similar IVA debt solution south of the border, but the rules for trust deeds were changed.

Ah okay, I will phone my trustee and ask for a settlement figure anyway, as it looks like it may fail if not and I can’t see any other option.

Thank you

Hi Vicky286.

I'd refer you back to Kevin's post earlier in this thread.

Full repayment might not be the only option here.