Trust Deed Vs Bankruptcy
When you are looking for the settlement of your debts, it is best to compare all the options available to you. This will help you in taking the right decision to deal with your struggle against debt. Though there are advantages and disadvantages both in the solution, your choice should be guided by the solution which suits your circumstances the best. Here are some facts and comparative analysis to help you in choosing the most effective debt solution for you.
Trust deeds are available to residents of Scotland only while Bankruptcy can be filed anywhere in the U.K.
- Minimum Debt Amount
The minimum debt amount to set up a trust deed is £5000 for an individual or £10000 for joint debts. Bankruptcy can be filed for debt amount exceeding £1500.
- Payment Period
The period for payment in a trust deed is a minimum of 48 months while in case of bankruptcy you have a maximum of 36 months.
- Review of income & expenditure by the trustee
In a trust deed the trustee has to Review your income & expenditure at least once in a year while in a bankruptcy he is bound to do so every 6 months.
- Discharge of debts
In a trust deed the Discharge of debts lasts for at least 4 years while in a bankruptcy this usually ends within a year
- Process of payment
In a trust deed you have to pay a certain amount monthly and generally the amount is decided depending on what you can afford to pay while in a bankruptcy you will have to give up all your assets to the trustee who will sell it to make money available for payment of your debts.
- Type of debts covered
Secured and unsecured both kinds of debts are covered in a trust deed Scotland while bankruptcy covers only the unsecured debts.
- Effect on debtor ‘s job
In a trust deed it depends on the company or firm you are working for while in bankruptcy there will be some effects on the ability to work in certain professions.
So now that you are equipped with all the necessary information it will be easy for you to make the right choice. It is important that to get the best services you have to take the help of debt experts, weigh all the pros and cons carefully before signing on the dotted line because once you do so you will be legally bound by the terms and conditions specified in the document.