1st Step Debt Advice

Advice

Debt Management Plan

This is an informal agreement between you and your creditors to pay your debt over a period of time. Interest and charges can still be applied, and the creditors can change their mind at any time, and continue to pursue you for the debt.

Debt Arrangement Scheme (DAS)

This is a statutory scheme run by the Scottish Government. This scheme is designed to allow people to pay their debt over a period of time, during which time creditors cannot pursue them for the debt. Interest and charges are frozen in this scheme.

Trust Deed

This is a legally binding agreement between yourself and the Trustee (an Insolvency Practitioner). This can be a very flexible and affordable solution for many people, providing them with a way to pay something towards their debt, either through a monthly contribution, or by way of realisation of your assets. A Trust Deed lasts for a set period, (normally 3 years) and provides you with the comfort of knowing that interest and charges are frozen. Once certain criteria are met the Trust Deed becomes protected, which means creditors are prohibited from taking action against you and at the end of the Protected Trust Deed any unpaid debt is written off.

Sequestration

In sequestration (bankruptcy) a Trustee is appointed to realise your estate for the benefit of your creditors. There are various criteria you have to meet before either applying for your own sequestration, or before a creditor can apply to the court for your sequestration. Once sequestrated, creditors cannot pursue you for your debts which you incurred before the date of your sequestration. If you are applying for your own sequestration, it costs £100. You will normally be discharged after one year, although payments to your Trustee out of your income can continue for up to 3 years.

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