Hi graham and welcome to the trust deed forum.

I'm sorry to hear that your debt management plan isn't working out.

A trust deed does run for a fixed period and then any remaining debts are written off.

However, the term is generally three years so I wouldn't rush to take up the offer you have received (five years) without finding out first whether you can do a trust deed over a shorter period. This will depend a little on your circumstances.

Are you a homeowner? If you are, could you tell us if you think there is any equity in your home and whether or not it's jointly owned?

Could you also tell us how much you are paying into your debt management plan each month? Is this an affordable amount, a stretch, or are you in a position to pay any more and still be OK?

If you can give us this information we'll be able to share a lot more thoughts with you.

Iam paying £ 338 a month plus i also pay £25 per month for my credit card and also £40 per month for a loan as we were still getting hassled from debt collectors as the the current company wasnt doing there job , these also get money from the £338 as well if that makes sense. 3 companies i pay .

Forgot to say im a homeowner , in joint names with my wife , maybe have £ 40,000 equity as present, i wouldnt want to pay anymore out each month .

Hi graham.

Thanks for the information.

You're currently paying a total of £403 per month. If that's affordable for you, and considered reasonable by a trust deed firm (based upon their assessment of your income and expenditure), I can see no reason at all why any trust deed you (alone) went into need last any longer than the regular three years.

You've mentioned the word "we"; is that £40000 of debt split between two of you? If it is, could you tell us how it is split between the two of you and if there are any joint loans or overdrafts? This is pretty important as it could make a big difference.

Could you also tell us about any assets that you have? Are you a homeowner? If you have a car could you estimate what it's worth for us? This is also really important as assets may have to be dealt with in a trust deed in a way that isn't the case for a debt management plan.

I think we were writing at the same time!

Thanks for the information about your home.

How much do you estimate the home to be worth?

How much is owing on any mortgages or secured loans?

On what basis have you come up with the estimate for the value of your home?

I Think all the debt are in joint names, £132,000 on mortgage no loans secured on it lol, recent sales on houses around us. i have a car but its on credit at the moment also have a over draught which is in joint names apart from that things are great not!! At the moment cant see any light at the end of the tunnel.

Have spoken to debt management company who phonrd me asap when i told them that i may be leaving there company. I asked how long it would take to clear everything and was told earliest was 7 yrs or it could be 16 yrs, thats not what they told me at the start of joining them worse move ever.

From the information provided graham I'm a little nervous about trust deeds for you both.

If there is £40000 of equity you'd have to pay it over into the trust deed (or each of you would have to pay your share of the equity into your trust deed).

That seems pointless if the debts are £40000, and it would likely be almost impossible to raise the cash without selling the home.

This position changes if there isn't any equity in your home; though you'd need a current valuation to know exactly where you stand in this respect.

There is another alternative which is called the Debt Arrangement Scheme. It's like a debt management plan but with much greater protection. If it gets up and running there will be no more interest (for sure) and you (and your home) will have legal protection from your creditors (which you do not currently have). There would be no messing about with having to pay extra bits of money to certain creditors. Unlike a trust deed, it does not take your home into account.

You may want to read a little more about it here:

http://www.trust-deed.co.uk/debtarrangementscheme.php

What if the value of house was lower so less equity in the house, would it benefit us?. dont want to be paying the debt back forever, would you recommend anybody to have a chat with , who i can trust and not be ripped off or told different things.

Hi Graham.

If there is little or no equity it will certainly broaden your options without the risk to your home that £40000 of equity will represent in trust deeds or a bankruptcy.

I'd very rarely point someone to a single individual adviser, but George White (see link to his profile on the main menu) could be a really good person for you to speak with.

He is a DAS approved money adviser (which means he can set up a debt arrangement scheme) and works for a provider of trust deeds. I'm sure he'd be able to help you weigh up the options and would be in a position to help either way if a switch makes sense for you to either DAS or a trust deed.

Hi Graham

The DAS does sound a good option for you, if you are correct about the equity in your home. The only other thing would be to get a valuation carried out so that you are sure of the equity before you decide. Some firms will carry out a valuation free for you.

My head is spinning around at the moment have left details with George White Company to phone me asap regarding Trust Deed over 5 yrs , one company say they can do it another says NO, it has to be a debt management for me as you cant do trust deed , who is telling the truth? i wonder

Hi Graham

George Whyte Company is not a name I'm familiar with.

My advice would be to sit down face to face with an IP firm and run through the options. Have them obtain both a vauation of the house and the redemption for the mortgage. This would make things a whole lot clearer.

Finally never believe anything someone tells you over the phone, always ensure it's fully backed up in writing.

Mark

Hello Mark.

I'm pretty sure that graham is referring to our own George White who works with Shona and Julie.