Welcome to the trust deed forum JayKay.

A trust deed would have a serious effect on your credit rating. This will usually last for six years. It's therefore not something that should be entered lightly.

It's not really relevant whether you make your payments on time or not. What is more important is whether you can truly afford the repayments. This is worked out by subtracting your necessary expenditure (excluding debt repayments) from your income. If there is enough money to live and pay your debts you would not want to enter any debt solution. If there isn't enough money then you'd ideally try to rebalance your budget but if that wasn't possible a debt solution might be necessary.

It doesn't usually make much difference to creditors whether payments are up to date. Trust deeds and other debt solutions are assessed on need and fairness rather than whether payments have been kept up.

If your financial position improves during a trust deed you'll normally be asked to pay more. The concept really is that a trust deed only writes off what you cannot reasonably afford to repay.

Hi JayKay,

I would answer your questions as follows:

1 - Yes, your credit will be affected for a period of time following your discharge.

2 - No. Even if you have paid all of your agreed payments on time you can still enter into a Trust Deed.

3 - Creditors all have different acceptance criteria for Trust Deeds. Most Insolvency Practitioners and their staff should know this criteria and providing your Trust Deed proposal meets the criteria, it has a good chance of being accepted.

4 - Payments in the Trust Deed can be subject to review and change should you circumstances change i.e. a wage increase of £250 per month but no real expenditure increase would mean an increase in your payments. It has to be a fair increase and not the whole £250.

Do you have any assets i.e. own your own propety or motor vehicle?