What Is A Scottish Trust Deed?
Scottish Trust Deeds are a form of government legislation debt solution alternative for persons who can no longer furnish their existing debts. This solution allows Scotland's residents to write off up to 90% of their existing debt with the full consent of their creditors. This usually takes place during a period of about three of four years given that there were no circumstances (such as pregnancy, or home equity) that would require or result in an extended repayment term. One low monthly payment is made each month during the course of the repayment period, after which time any existing debt is written off.
To qualify, applicants must meet the following requirements:
- Either live in Scotland, own a place of business there or have lived their within the last 12 months
- Apply through a legitimate Insolvency company
- Have debts exceeding £5,000.00
- Be able to pay the stipulated monthly amount through one's current income. If there is no immediate income, applicants should have assets that can provide a return of 10p to the £ - minimum
- Unable to pay your debts as they currently exist. That is, you are insolvent
What Kinds Of Debts Are Covered?
In addition to debts having to exceed £5,000.00, the kinds of debts which qualify under the agreement are very specific. Debts covered are usually unsecured debts such as Council Tax arrears, loans, bank overdrafts, credit cards and store cards. Student loans are not applicable.
What You Should Know
Before submitting an application, you should know that like everything else in life, there are pros and cons. Here are some pointers to bear in mind before you apply. To help you decide if a Trust Deed Scotland is the right option for you, consider the following:
- Applicants should know that Insolvency Practitioner (known as a Trustee) can arrange for and administer Deeds. Therefore, applicants should be careful about the company he or she contracts to undertake the process on their behalf. Applicants should also ensure that the insolvency company he or she selects does home visits as they are very important in the final analysis.
- Whether you are a private tenant or a home owner, you are still able to apply for a Deed. However, homeowners with equity on their homes should be aware of how much equity is left on their home. If it has been established by your trustee (before signing) that there is too much equity left on your home, you may be encouraged to raise the money, extent the term of the deed (like four years versus three), or make use of other Debt Arrangement Schemes as this option may not be as viable an option.
- Due to the face that this is a mutual agreement between the debtor, the trustee and the creditors, it is important to note that creditors are not obligated to agree to a Trust Deed Scotland. However, if creditors valuing more than half of your total debt agree to the terms, less than 33% of your creditors disagree, you can still go ahead with the Deed, as the other debtors are still legally bound. Additionally, debtors must realise that they agree to pay the monthly contribution agreed upon at signing, and co-operate fully with the dictates of the trustee. Therefore, debtors should inform Trustees of any change in circumstance -- for better or for worse. This includes informing the Trustee of unexpected windfalls.
- Finally, this is not a loan, and the terms stipulated by Trustees vary from one organisation to the next. As such it is important to do your research. Debtors can also feel free to consult websites like trustdeeds.net for more information regarding the same.
Applying for a Deed may be a better insolvency solution to bankruptcy. There is usually no credit checks required to qualify. Although an alternative to bankruptcy with the effect on your credit rating not being as devastating, you will have to take steps to rebuild your credit rating once you have been formally discharged from your Deed. Your information is kept private as the insolvency company entrusted with your Deed will only enter your information in the Registry of Insolvencies.
If you are a UK resident and are down with financial issues, there is a legal alternative other than bankruptcy declaration. The legal option is called Individual Voluntary Arrangement, or IVA.
IVA seems to be the right resort for most British residents who are plagued with a series of debts and major financial difficulties. These people are perhaps unable to repay their loans or make periodic payments, manage mortgage or their credit payments, or are shouldering other debts that they aren't financially capable enough to repay.
IVA - Explained
The IVA is a legal arrangement wherein the creditors are paid off by the defaulting individual, with the Insolvency Practitioner or the court administrator supervising the state of affairs.
Introduced as a law in 1986, IVA was set up and is under governance of the Insolvency Act, Part VIII. It's available to the residents of England, Northern Ireland, and Wales - there is no IVA Scotland, Scots have the Standard Trust Deed instead.
Anyone who has debt in excess of 15,000 British pounds and with a steady income source can apply for IVA Companies and use it to his/her advantage. There are several online and offline resources offering IVA help, IVA advice, suggestions, and tips.
IVA Working Mechanism
With IVA, the debtor offers to pay a certain debt percentagein the form of monthly investments to the creditor. The monthly figure arrived upon is based on the IVA calculator and what the debtor can possibly afford, with an Insolvency Practitioner around for assistance.
Most creditors are happy with an IVA deal as the returns they'll make are much higher compared to a bankruptcy proceeding. Once agreed upon, the debtor must pay the installments regularly, or the IVA debt contract would get pushed to the state of default.
An IVA usually lasts five years, but it's not uncommon to see debtors paying off their debts much earlier.
When in a financial disarray, an IVA contractual arrangement is much better compared to bankruptcy declaration.
For a business owner tied to an IVA agreement, he can continue operations, provided the IVA installments are getting remitted without fail.
In case of bankruptcy, the person at default invariably ends up selling his house. However, other assets may be brought under scrutiny. If one requires his car for daily commute, the vehicle can get exclusion.
An IVA can be proposed even if the Order of Bankruptcy is against the debtor; however, things may get a bit tough thereafter.
If the debtor is on Income Support, bankruptcy or a less formal repayment plan must be considered.
If one loses his job or income source during the course of the IVA contract, getting in touch with the Insolvency Practitioner is recommended, as not doing so results in non-compliance of IVA terms.
If an IVA agreement affects one's job status or accreditation, clearing out the air well in advance is recommended.
Furthermore, during the IVA agreement period, the debtor cannot apply for or seek any type of unsecured credit, such as personal loans, credit cards, etc. A note is placed on the defaulter's credit file, which alerts prospective lenders. The restriction on credit stays in effect until a year of IVA is successfully completed.
The completion of the IVA period is perhaps one of the most gratifying moments for any debtor. Once the agreement duration elapses with all the stipulated payments made to the creditors on time, the debtor gets an IVA completion certificate from the Insolvency Practitioner.
Those who run a company in the United Kingdom should consider getting Key Man insurance. There are many benefits of getting Key Man insurance, and some of them will be discussed below.
What Is Key Man Coverage
This type of insurance is exactly what it sounds like. It is life insurance that is placed on a key person in the business, such as the business owner or an executive. The company pays for the coverage, which means the company is responsible for paying the premiums. It is usually placed on the person/persons who plays an extremely important role in the day-to-day operations of the business. The type of people the insurance is placed on are on the people who keep the business running.
What Does Key Man Cover
You may be wondering what does this type of insurance cover? It is a lot like traditional life insurance, except that the money that is paid out is paid out to the business. The purpose of the funds is so the business can still operate after losing a key person.
Benefits Of Getting Key Man Insurance
There are a lot of benefits of getting Key Man insurance, with one of them being that it can provide a business with the financial support that it needs in the event it loses someone of importance. There may be a high-level executive that passes away, and that executive could be responsible for bringing in hundreds of thousands of dollars in revenue every single year. If that person all off a sudden passes away, then the business could lose out on all that money. Also have a read of guide to life insurance if you feel this post so far has inspired you to learn more.
Another benefit of getting this type of policy is that it prepares your business for the worse case scenario, as well as prepare your company for the unexpected. The last thing you want is for your business to struggle financially because someone has passed away. Another benefit is that there is not a set amount you have to get. Just as the case is with traditional life insurance, you only need to get what you think you need. You may only need a policy worth a few thousand dollars or you may need one that is worth a few hundreds of thousands.
Getting A Quote
Getting a quote is very easy to do, and you can get a Key Man insurance quote online. All you need to do is provide a few details about yourself and your company and the amount of coverage you are interested in getting. Once you have done this, you will be given a quote.
If you decide to get the insurance, then you will be told how much your premium is, as well as any other applicable fees you might have to pay. Your policy will explain what happens in the event the key person passes away, and how the funds will be distributed. Getting a quote is the first step in getting the coverage your business should have. Keep in mind that different policies will vary in price, and this is why it is important to get a few quotes before you decide to purchase a policy. If you have never considered getting a Key Man insurance quote or even considered purchasing this type of policy, then now is the time to do it. It doesn't matter if you run a very large business, or if you run a small company that operates from one location or a few locations, you can benefit from having insurance. Get the peace of mind you deserve and get a quote today.