The basicsWhat is a Protected Trust Deed?
A Protected Trust Deed is a formal, legally binding agreement between you and your
unsecured creditors, operating solely under Scots law. You commit to repaying an agreed,
affordable portion of your debt in fixed monthly instalments — usually over a period of around
4 years. Once the arrangement has been completed successfully, the remaining unpaid
unsecured debt covered by the agreement is written off. Throughout the arrangement you
are protected from further recovery action and court proceedings by the creditors it covers. In
structure, a Protected Trust Deed is very similar to an IVA — the difference is that it rests on
separate Scottish legislation.
BenefitsWhy consider a Trust Deed?
For many people living in Scotland, a Protected Trust Deed is a way to regain control of their
finances without having to declare bankruptcy. The main reasons people choose it:
Advantages of a Trust Deed
- Lower monthly payment — you pay an affordable amount matched to what you can genuinely afford.
- Quick to set up — the arrangement can usually be prepared and put in place within around four weeks.
- An end to recovery action — creditors covered by the agreement cannot take legal action or contact you about repayment.
- Remaining debt written off — the unpaid part of the unsecured debt is written off once the arrangement ends.
Drawbacks and risks
- Impact on your credit score — the entry stays on your credit file for 6 years.
- Protection is not guaranteed — creditors may object; if enough of them do, the agreement may not gain „protected” status.
- Assets and property — in some cases you may be asked to release part of the equity built up in your property.
- A binding commitment — this is a legally binding agreement; stopping payments may allow creditors to resume recovery action.
EligibilityIs a Trust Deed right for you? Who qualifies
A Protected Trust Deed works well for people with a regular income who can make an agreed
payment but have no way of repaying their debt in full within a reasonable timeframe. To qualify
for a Trust Deed, you normally need to meet the following conditions:
- You live in Scotland (or have lived there within the last 12 months).
- You have at least £5,000 of unsecured debt that you are unable to repay.
- You can make regular payments of the agreed monthly amount.
- You have a regular income that does not come solely from benefits.
- You have not been declared bankrupt in the last five years.
Where it appliesWhich UK nation does a Trust Deed apply in?
A Protected Trust Deed is available only to residents of Scotland
— it is the Scottish equivalent of an IVA. If you live in England, Wales or Northern Ireland,
the comparable solution is an IVA (Individual Voluntary
Arrangement), based on the legislation that applies across the rest of the UK.
The processHow does it work, step by step?
We guide you through the whole process — no pressure, at your own pace. Here is how it works:
- Free consultationYou answer a few questions about your financial situation and we check whether a Protected Trust Deed is right for you.
- A call with an adviserWe discuss your goals and the options genuinely available to you. We work out the instalment you can afford each month.
- Preparing the arrangementA licensed Insolvency Practitioner prepares a formal Trust Deed proposal for your creditors.
- The creditor decision periodCreditors are given time to consider the proposal. If they do not object successfully, the agreement gains „protected” status.
- Setting up and repayingYou make one monthly payment, and the practitioner distributes it among your creditors for the whole term of the arrangement.
After the arrangementWhat happens once the Trust Deed ends?
Once the arrangement has been completed successfully (usually after around 4 years of regular
payments), the outstanding part of the unsecured debt covered by the agreement is
written off. It is worth remembering that certain obligations — such as court fines,
maintenance payments or some student loans — usually cannot be included in a Trust Deed. Open
Finance will guide you through the entire process in plain English: from the first conversation
to closing the arrangement.
Getting helpYou don't have to face debt alone
Facing debt can feel overwhelming — but the sooner you reach out for help, the easier it is to
find a solution. There are no „magic ways” to make debt disappear —
only legal, proven routes, and a Protected Trust Deed is one of them for people
living in Scotland. A free consultation with our adviser comes with no obligation and does not
affect your credit score until you accept the solution proposed.
