Contact the experts


Parents often provide money support, for example.
What happens if you enter a Scottish trust deed?
Debt owed to a person you know has no special status. If you start a trust deed, it’s technically just another debt.
You will not be given a budget to keep paying them. Your surplus income gets paid to your trustee. There will be little money spare to keep repaying them.
Finding extra income (like a second job) will not solve the problem. More income will result in a higher trust deed payment.
Talk with the people who helped you out. They lent you money because they wanted to support you. Would they be prepared to wait to be paid back? Could you repay them after your trust deed has ended?
They might be shocked when they hear of your debt problem. They might welcome the opportunity to help you fix it.
This is possible. Your trustee may ask them to prove that they are owed money.
The trustee will decide whether to accept their claim. If accepted, they’ll be treated like the other creditors. They will receive a dividend that repays part of the debt.
It’s different with your husband, wife, or civil partner. They get ranked below your other creditors.
Unless the other creditors get fully repaid, they do not receive a dividend.
Has a relative or friend guaranteed your loan? If you enter a trust deed, they’ll need to take over the payments. You can’t keep paying a guarantor loan to protect them.
Read more about guarantor loans and trust deeds here.