Sequestration is a legal order which confirms to your creditors you are unable to repay the money you have borrowed. Sequestration is only available to people residing in Scotland. The English, Welsh and Northern Irish equivalent is bankruptcy.
In November 2010 the certificate of sequestration came into effect. This route to sequestration makes it simpler to proceed with your own sequestration.
Another route into sequestration is the Minimal Asset Process which became applicable on the 1st April 2015.
There are different qualifying criteria for the various routes into sequestration however the advantages and disadvantages are all relevant.
If you live in Scotland then you may not need to consider Sequestration, a Protected Trust Deed or debt arrangement scheme could be more suitable. More information can be found on our debt advice Scotland Page.
People entering Sequestration often have a lot of questions about the debt solution.
The most common questions people have about sequestration are, how much does it cost, how will it affect my credit rating and how do i enter sequestration.
If you have any questions about Scottish bankruptcy and need advice our sequestration forum can help.
- Must owe at least £1,500 in unsecured debt
- You cannot realistically meet any other debt solution
- You will need "apparent insolvency"
In Scotland bankruptcy is sometimes called sequestration.
The minimum amount of debt to enter the Minimal Asset Process (MAP) route to sequestration is £1,500. If you do not meet the MAP criteria then you must have £3,000 of unsecured debt to be applicable for sequestration.
You can apply for your own sequestration via an approved money adviser. There is a £200 fee, however if you meet the MAP criteria then the cost is £90. A creditor can also petition to court for your sequestration once they have taken appropriate steps to recover the debt. This can include a charge for payment or statuatory demand being issued and the time to pay on the document expiring with the debts remaining unpaid.
To apply for the minimal asset process (MAP) route to sequestration it costs £90. If you are applying for a certificate of sequestration the application fee is £200.
You will be discharged from your sequestration after 1 year, however a note regarding your sequestration will remain on your credit file for 6 years.
Yes, you can enter sequestration via the MAP or certificate of sequestration routes. The correct method will depend on your financial situation.