To help highlight how many Scots are struggling with debts, it has been revealed that there has been a 20.6% increase in the number of Scots going through the insolvency process in Scotland.
That equates to 12,788 extra people opting on this route to help solve their financial problems.
The figures, from the Accountant in Bankruptcy, relate to personal debt and include both sequestration and protected trust deeds in 2018 and 2019. The biggest increase has been in the type of protected trust deeds that the team at Scotland’s Trust Deed specialise in.
What is a Trust Deed?
A trust deed is a financial solution for people who would prefer to avoid the impact that full sequestration can have on their lives and this year there was a 32.8% increase in the number of people taking this option.
Your trust deed will be an official agreement between you and the creditors you owe money to. Scotland’s Trust Deed will negotiate with your creditors on your behalf and if successful your trust deed will become ‘protected’.
Protected status means that you will pay a significantly reduced figure over four years. Keeping up with the payments negotiated will ensure that no creditor is permitted to chase you for payment or make threats about taking the matter to court.
Scotland’s Trust Deed is also experienced in providing qualifying customers with Debt Payment Plans (DPP) that may lead to Debt Arrangement Schemes (DAS). These too have seen an increase with 2,544 agreed in the 2018/19 financial year – that’s 226 more.
The data that the Accountant in Bankruptcy has collected shows a consistent increase in personal insolvency over the past three years. This makes for alarming reading, but the figures aren’t as high as the insolvency increases in the years 2007/8 and 2013/14. Periods of uncertainty lead to higher rates of unmanageable of debt.
According to Scotland’s business minister, Jamie Hepburn, he says the current insolvency figures are down to uncertainty around Brexit and the ongoing issues with Universal Credit.
Mr Hepburn also said that he is pleased that the Debt Arrangement Scheme, which Scotland’s Trust Deed can help with, is being used by people in trouble with debt.
He said they provide ‘controlled repayment of debt without fear of further recovery action being taken’.
Trust deeds and the DAS are becoming the preferred choice for Scottish people fighting their way out of debt. They allow debtors to keep their homes and don’t threaten positions as the Director of a company or within certain careers. Sequestration truly is the last resort and should be given careful thought.
Do you live in Scotland and have your debts become a struggle to finance? Are you looking for a solution to your financial problems? Then contact the team at Scotland’s Trust Deed today for support and advice.