Debt solutions in England, Wales and Northern Ireland are different to those in Scotland. This is because the legal legislation is different. This can mean people are searching for debt solutions which may not be possible for them because they don't live in the country to qualify.
For instance, an IVA is an English, Welsh and Northern Irish debt solution but people in Scotland cannot enter an IVA. However, there is a similar Scottish debt advice solution called a Protected Trust Deed.
An IVA and a Protected Trust Deed are insolvency solutions which are alternatives for other debt solutions like Bankruptcy. The solutions allow you to put an offer to your creditors where you agree to pay what you can afford each month for a period of time. If agreed by your creditors, you will repay an affordable amount and then the remaining debt will be written off and you will be debt free. Your assets, like a house and car, are also considered and if you have equity then you may have to release this.
The Scottish IVA alternative, the Protected Trust Deed, is a popular debt solution for people living in Scotland with debt. It enables a person to put an offer to their creditors to make one affordable monthly payment, usually for 4 years. At the end of the Protected Trust Deed people are debt free with typically 50% of their debt being written off. Only the amount which you can't afford is able to be cleared.
There are some negatives with the Protected Trust Deed, such as it will affect your credit file for 6 years and it can mean releasing equity out of your property (if you have equity and your house is mortgaged).
There are some key differences between the IVA and Protected Trust Deed other than where a person lives and the law which governs the solution. For instance, some of the differences are:
Deciding if a Scottish IVA (Protected Trust Deed) is right for you will depend on your financial and personal situation. Often there are a number of suitable solutions and it's our responsibility as a charity to ensure you have all of the relevant information so you can make an informed decision about the debt solution you wish to enter. There are pros and cons to all debt solutions and it's essential you are aware of these.
To find out if a Scottish IVA/ Protected Trust Deed could help you please telephone on of our friendly team on 0800 085 0226. If you are telephoning from a mobile please let us know and we will call you back to save your phone bill.
Alternatively, you can see if a Scottish Protected Trust Deed is the best solution by completing the debt analyser test below.