TheBigChap,

I am sorry to hear that the trust deed has not been approved. Has the trustee advised whether negotiations have been conducted to see if the rejections from creditors be removed?

A sequestration runs in the exact same way as a trustee whereby you would make the same monthly contribution over 36 months and no more. Equity available in any assets is dealt with in the same way. You will not lose your home. The Truste has greater powers to deal with property in a sequestration however if there is no equity then the property does not take part on the estate. A £500 nominal sum from a third party may be requested from the Trustee to deal with the house.

Other than that everything the same. Oh you will receiver automatic discharge after 1 year however, not 3 years, as long as you comply with your Trustee

To add cars worth below £3,000 do not take part, the Trustee has no power to remove anything from your house (unless you have a Monet on your wall!)

Try not to panic, Big Chap - it won't be half as bad as you are imagining. A few questions...

Is the insolvency practitioner that you signed your trust deed with advising that you nominate them to be your trustee in the sequestration too?

If so, have they done a valuation of your property already and confirmed the equity position for sure?

Do you know which creditors objected to your trust deeds and why? As Rob says, if you really would rather not apply for sequestration then it may be possible to negotiate to get their agreement to overturn their objection, eg by proposing to lengthen the term of the trust deed.

Thanks Rob , One of my creditors hold 50% of our debt and have rejected it and also one other, she didn't say if negotiations had taken place as she said the rejections had only come in today, the cut off was tomorrow. I think the objections have been there for longer. No Monet on the wall 🙂 I've googled sequestration and it looks similar to the trust deed ? Is there other negatives.

Hi Kevin yes they are proposing I nominate them, we had a valuation on the house when the deed was signed and we didn't have any equity , I'm unsure if they have negotiated extending the deed.

Hi Bigchap

Can I ask who the main creditors were, the total debt and what the contribution was.

Mark

Hi mark our main creditor was rbs creation and northern rock totaling 31500 k between us we were offering £500 per month contribution.

Hi TheBigChap.

How long was the trust deed due to run for?

Do you know how much the proposed fees were for the trust deed(s)?

Hi it was going to run for 3 years as of there fees I am unsure, what is the diff between sequestration and the trust deed? Is one better than the other? And if so why?

Sorry to hear about this TheBigChap. Im an a very similar situation to you....£31k and also have RBS and Creation as creditors. My proposed contribution is significantly less than yours so Im getting worried now. I cant see how your £500 contribution can be rejected though as this gives £18k across the term....therefore even if your IP was taking £15k in fees!!!!!....the creditors would still get 10p in the £. Do you know why it was rejected??

Other negatives, slightly more stigma attached to sequestration than TD as formal bankrupt y. However, much more common these days and a lot less frowned upon in recent years. A lot more common.

Unable to act as a director or a limited company in Sequestration for 1 year until discharge.

Some employers will not allow employees to enter sequestration but very rare. Only really if you work in financial services industry.

Greater power to Trustees to realise assets. Mainly house. Trustee in TD has no power to possess house. In sequestration Trustee may, through the court, should they require to. Not applicable on your case as it looks like there is no equity in the property, therefore no asset, no benefit to the estate/creditors.

Other than that mechanisms the same, discharged automatically after 1 year, compared to 3 or 4 years in TD. Creditors have no power in sequestration and sequestration cut through any diligence which means creditors can not take any action whatsoever. No protection required. Those are the benefits.

Northern Rock particularly TD unfriendly. If they are a majority creditor then hell will freeze over before they withdraw their objection. They are traditionally opposed to the majority of TD proposals.

Hi Thebigchap

With those creditors, it would be difficult not to get it accepted.

Northern Rock is dealt with by Grant Thornton with the rest being TIX creditors. Both work to a specific criteria which you would know would fail before the proposal was submitted. I'm betting trustees fees were more than 50% of total contributions and its being rejected by NRAM on that basis.

All your trustee has to do is adjust their fees and the objection would be overturned.

Rob, I'm not sure who you deal with at Northern Rock, but we have had no objections whatsoever and any which were queried were overturned with no difficulty whatsoever.

Mark

Hi Thebigchap,

I'm sorry to hear that your creditors have rejected your TD proposals especially after we told you not to worry. Sequestration is really nothing to be worried about.

As Mark has said we don't have any problems in dealing with Northern Rock creditors either and I assume it will be down to the Trustees fees and total costs of the TD that they will have objected to. Speak with your Trustee and ask why they have objected and if it is down to fees ask them to reduce them.

You should be able to find out what the total costs of your TD is by looking at the proposal that was sent to your creditors as you should have received a copy of this. If its more than 50% of what your paying into the TD then this will be the reason.

Don't worry it's not the end of the world and we can help you through this set back.