Who Approves a Trust Deed?
13th September 2011
Many visitors to the Trust-Deed.co.uk forum have questions about what will and will not be allowed if they go ahead with a trust deed, what they can and cannot do, and what will or will not be expected of them in certain circumstances. Often the underlying question comes down to who actually is in charge of the trust deed process and in what circumstances they can exercise that authority. As we’ll see, the person or body that approves a trust deed in Scotland varies according to the scenario.
Most importantly, a trust deed is a voluntary process. Anyone who signs a trust deed does so voluntarily. Before they sign they should know how much they will be expected to pay each month, what will happen with their assets that they currently own, what will happen if they acquire any new assets, and what will happen if their circumstances take a turn for the better or for the worse.
A trust deed is an individual agreement and the exact terms will vary from case to case. It should only be signed once the matters mentioned previously are clarified fully. To this extent, the signing of a trust deed is the act (on the part of the debtor) of approving their particular trust deed to go ahead.
Of course the documentation for the trust deed will have already been drawn up by the team of the Insolvency Practitioner that is being appointed as Trustee. The Trustee will need to be satisfied that a trust deed is an appropriate option for that debtor, that they have been made aware of their responsibilities under the terms of the trust deed, and that creditors can expect a fair return given the circumstances. Approval of a trust deed is also therefore the responsibility of the Trustee that accepts the appointment.
Once a trust deed is signed it’s up to the creditors to decide whether the trust deed then becomes protected. They vote on the proposal made and, if enough of them support the arrangement, the protected trust deed is established. Clearly creditors also play a fundamental role in the approval of setting up an effective trust deed.
Also involved in the process is the Accountant in Bankruptcy which now supervises the trust deed process and who also have an audit role.
The approval of a trust deed therefore comes down to the individual concerned, their chosen Trustee, their creditors and the appropriate supervisory body. Anyone who is worried about their debts and is considering a trust deed has little or no control over who they now owe money to. They do however exercise full control over whether or not they agree to the terms of their trust deed, whether they take the time to fully understand their responsibilities, and who they should appoint as their Trustee in the process.
The evidence from our trust deed forum is that where an individual sensibly exercises control in the areas in which they have the ability to do so they tend to get a better outcome.
To learn how to control your trust deed properly, or to find the answers to any trust deed questions you might have, just visit our website, www.Trust-Deed.co.uk has a fantastic array of resources to help you with every element of the trust deed process. The site includes pages full of helpful tips and information as well as a forum where you can chat to people who are in a similar financial position as you and also to trust deed experts.
Our team of professionally-qualified trust deed advice experts are available on 0800 043 7201 if you require any more assistance with your trust deed queries.
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