The Scottish IVA equivalent
An Individual Voluntary Arrangement (IVA) only applies to England, Wales and N. Ireland. Debt Help Scotland legislation is slightly different and provides for a similar financial instrument called a Protected Trust Deed or a Deed of Trust.
The Trust Deed is a legal process like that for an IVA and in order to qualify you must actually be resident in Scotland. The Trust Deed provides a similar remedy to an IVA in that it has been specifically designed to help Scottish consumer debtors restructure all of their unsecured borrowings in order to avoid bankruptcy.
A Trust Deed is designed to last for a fixed period of 36 months whereas an IVA usually lasts for 60 months. At the end of the Trust Deed period all remaining debts are completely written off and the debtor I then entirely legally debt free.
Features of Trust Deeds
- A Trust Deed will allow you to avoid sequestration (Scottish Bankruptcy).
- The Trust Deed is dealt with more privately unlike a bankruptcy which is formally published.
- All interest and further charges on the debts will stop.
- All dealings with creditors and other third parties are dealt with by the appointed Insolvency Practitioner.
- Trust Deed restructures usually only lasts for a fixed period of three years at the end of which the debtor is completely debt free.
- In most circumstances the debtor would need to have a minimum of £10,000 unsecured debts and little or no property equity with which to repay the debts.
- A Trust Deed cannot override any Arrestment (an attachment of earnings) which would need to be paid.
- A simple Trust Deed can be proposed and become “Protected” in 5 weeks.
- Only an Insolvency Practitioner based in Scotland would ordinarily be able to complete the Trust Deed negotiations.
- Failure to complete the payment obligations under a Trust Deed could very well result in bankruptcy.
Whether you live in Scotland or live in England and you are self employed then you should take time to research self employed IVA for up to date information and help.