Invocas Financial

A Trust Deed is an alternative to Sequestration. Basically it is a contract between your client and their creditors, administrated by a licensed Insolvency Practitioner. The terms of your client's proposal to creditors may be flexible, but creditors will reasonably expect their prospects of recovering money to be at least as good as in a Sequestration.

Your client can only be considered for a Trust Deed if they owe at least £7,500 of unsecured debt to a minimum of 2 different creditors. Your client must be in paid employment and be able to afford a minimum contribution of £125 per month (this may need to be larger depending on the size of the debt) after priority debts, such as their mortgage, to pay towards their creditors.

If your client signs a Trust Deed then they will be transferring all of their assets to a Trustee. Assets can include their share of any equity in their home, cars, investments or any other significant assets.

Once your client signs a Trust Deed their Trustee will place an advert in the Edinburgh Gazette. This is a publication subscribed to by solicitors, accountants, banks and various other institutions. Your clients' creditors will have 5 weeks to object to the terms proposed by their Trustee.

Provided that no more than one third in value or a majority number of their creditors object to the terms proposed, the Trust Deed will become "Protected". This means that their creditors can no longer pursue your clients for sums owed to them, petition for their Sequestration or take any other legal debt recovery action.

A Trust Deed allows your client to agree a fixed monthly repayment with their creditors. Once they have made their final payment, all outstanding debt is legally written off by the creditors.

To summarise:

• All pressure from creditors is removed
• Your clients will only repay what they can reasonably afford
• We will deal with all correspondence and queries from your client's creditors
• Your clients will pay only one monthly repayment
• After completing a Trust Deed, which normally takes 3 years, your clients will be completely debt free from the debts that were included in their Trust Deed and will be ready to start afresh financially

At Invocas Financial, we do not bill your client for the work done. During the negotiations with your client’s creditors, we will agree our fees. Your client will be fully informed of the fees before they commit to this solution.

The initial signing of a Trust Deed can be done very quickly (a matter of days). After an initial telephone consultation, we will visit your client at home to clearly explain what they have to do. Your clients are under no obligation to sign and if they change their mind we can offer another solution. After your clients have signed the Trust Deed, it takes approximately 4-5 weeks for the creditors to accept the proposal.

Normally a Trust Deed lasts for 36 months (3 Years).

Normally, yes. However with a Trust Deed your clients will have to release any equity available in their property to pay their creditors. We will be able to advise your clients fully on this.

Once your clients have signed a Trust Deed, creditors are given approx. 5 weeks to agree or dispute the proposal. Your client's proposal will be sent to all of their creditors so they are able to consider its terms and object if they wish. If your client's creditors agree to the proposal after the 5 weeks (non-response is accepted as agreement), the Trust Deed becomes “Protected”. At this point your clients have complete protection from your creditors. A Trust Deed will only fail if half the creditors (or 1 creditor with greater than one third of the debt) oppose it. This very rarely happens.

If you think your client may benefit from a protected trust deed, call our team on 0845 60 60 661 who would be happy to discuss any cases with you.