Hi there,

I'm afraid that the trust deed can continue as long as is necessary, basically until the trustee feels that you have met your obligations as set out at the start. However, this is not usually a desirable outcome for any parties involved.

You cannot yourself apply for bankruptcy whilst in a protected trust deed - your trustee would need to agree to do this for you. If you are made bankrupt then you would be discharged after 1 year (although if paying a contribution then you would have to continue to pay this for another 2 years after discharge). The equity position in your property would have to be established and then this would need to be realised for the benefit of your creditors. In other words your property could be at risk, especially if there is a significant amount of money that could be released by forcing its sale.

Sorry, not much to give you comfort here.

Why is it that you missed lots of payments, solution? How many payments more are they expecting you to pay?

Hi solution and welcome to the trust deed forum.

Discharging you from your debts is something that your trustee will do rather than your creditors.

You can only become bankrupt if your trustee first brings the trust deed to an end. It isn't an option while you're still in it.

Does your property have equity in it?

Do you know how much still remains of your original commitments to your trust deed?

What have been the factors that have made it difficult to meet the terms of the original agreement?

I think Kevin and I were writing at the same time... and he's a bit quicker.

I had lost 2 jobs through redundancy and have spent some time at her majesty's pleasure. I am currently out of work. These have all made an impact on my payments. Would any of this time out of work/prison have any impact on the length of time remaining on my trust deed. I would like to put all this behind me and have a fresh start. My property I think would not have much equity as the mortgage is currently at £94k and is valued around the same.

quote:

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Originally posted by Kevin Mapstone

Hi there,

I'm afraid that the trust deed can continue as long as is necessary, basically until the trustee feels that you have met your obligations as set out at the start. However, this is not usually a desirable outcome for any parties involved.

You cannot yourself apply for bankruptcy whilst in a protected trust deed - your trustee would need to agree to do this for you. If you are made bankrupt then you would be discharged after 1 year (although if paying a contribution then you would have to continue to pay this for another 2 years after discharge). The equity position in your property would have to be established and then this would need to be realised for the benefit of your creditors. In other words your property could be at risk, especially if there is a significant amount of money that could be released by forcing its sale.

Sorry, not much to give you comfort here.

Why is it that you missed lots of payments, solution? How many payments more are they expecting you to pay?

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I had lost 2 jobs through redundancy and have spent some time at her majesty's pleasure. I am currently out of work. These have all made an impact on my payments. Would any of this time out of work/prison have any impact on the length of time remaining on my trust deed. I would like to put all this behind me and have a fresh start. My property I think would not have much equity as the mortgage is currently at £94k and is valued around the same.

It is hard to give you any definite answers here. The guidance that trustees are meant to follow states that they shouldn't refuse to discharge someone from their trust deed purely based on a change of circumstances beyond their control. I don't suppose going to prison would fall into that category, though redundancy probably would.

If there is no prospect of you being able to pay the remainder of your trust deed and you are pretty confident that there is little/no equity in your property then you should seek to discuss matters with your trustee. If they are unwilling to discharge you from your debts through the trust deed then sequestration (bankruptcy) may well be your best bet instead. I think you may have to persuade them to apply for it though, as you signed your trust deed before the rules changed so I don't believe they can just terminate the trust deed and allow you to apply yourself.