A protected trust deed is a formal arrangement available in Scotland that allows individuals to legally bind all of their unsecured creditors. It enables debts to be dealt with through a licensed insolvency practitioner (trustee) on a voluntary basis. The trustee takes control of the individual's assets to pay off debts. If creditors agree, the trust deed becomes protected, stopping debt collection actions like wage garnishment. A protected trust deed can be applied for by anyone in Scotland with over £5,000 in debt and provides benefits like a discharge from remaining debt after completion.

1. WHAT IS A
PROTECTED
TRUST
DEED?

2. A protected trust deed is a formal, Government
laid arrangement, available for the residents of
Scotland to legally bind on all of your unsecured
creditors. If you have assets like a property,
your Trustee will also look to release any
available equity through remortgage, or if you
are unable to remortgage, by selling your home.
Simply put, it enables you to deal with your
debts through a licensed insolvency Practioner
(Trustee) and is a voluntary process.

3. How
does
Trust
Deed
Work?

4. When you grant a trust deed, you mean to transfer
your possessions to an insolvency practitioner. The
trustee further gives your creditors an undertaking
that he will use your assets to pay off all your debts.
The Trustee then makes a proposal to your creditors
and asks if they agree to your trust deed becoming
protected. And if there are no objections, your trust
deed will be protected.

5. Who
can
apply
for a
Trust
Deed?

6. A Trust deed can be applied for by anyone living in Scotland
who has a debt more than 5000 pounds. When a government
agency registers your trust deed at the end of the 5 week
notice period, it becomes a protected status. However, the
effects include:
• Stops earning arrestment
• Stops wage arrestment and bank arrestment for debts
• You get a discharge at the end of your trust deed once you
co-operate and do everything as agreed.

7. Source
• https://freedebthelpline.org/protected-trust-deed
• https://en.wikipedia.org/wiki/Protected_trust_deed
• http://www.debtadvicefoundation.org/questions/protected-trust-deed