Trust Deed frequently asked questions…

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To find out more about managing your money and getting free debt advice, visit Money Advice Service, an independent service set up to help people manage their money.

Will I lose my home?

If you own your own home, your Trustee will do their best to ensure you don’t lose it. But you do have an obligation to realise any value in your home, so if your home is worth more than the outstanding mortgage, your Trustee will look at options such as remortgaging or extending the period of your contributions, in order to return a fair amount towards your debts.

Will my credit rating be affected?

A Trust Deed is listed on your credit report for at least six years after the date it is accepted. This will affect your credit rating and your ability to get credit after the Trust Deed is complete, and if you are accepted for a loan or mortgage in future, you may not be able to get the best rates. However, if you have serious problems meeting your debt repayments and are considering a Trust Deed, your credit rating may already be affected.

When you sign a Trust Deed you agree not to take out further credit over L500, without informing your Trustee. You would be well advised not to take out further credit while you are still making your contributions from income, as your budget will have been calculated to allow for your regular bills, groceries, and Trust Deed contributions, and no more.

Will people be able to find out I’m in a Trust Deed?

The fact that you are in a Trust Deed will be listed on the Register of Insolvencies, which is available online to the general public. However, you need to apply for an account in order to access the Register, and it is mainly used by creditors and credit reference agencies.

Will I have to tell my employer?

You don’t have to tell your employer, but there are certain jobs you’re not allowed to do if you have entered a Trust Deed or other formal debt solution. This is something you can ask your Money Adviser about in confidence before you make any decision.

What if I get a raise or my finances improve?

If you get a raise, a bonus, inheritance, winnings or other windfall, you must declare this to your Trustee who will advise you if this needs to be offered to your creditors. It is likely that you will get to keep a portion of any raise or bonus at work. This benefits both you and your creditors because you have an incentive to earn more and so return more money to them as well as yourself.

Can I cancel a Trust Deed?

A Trust Deed is a legally binding agreement, and you cannot cancel it once you have signed. So it’s vital that you get the right advice before making any decision.

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