Everyone experiences portions of their lives when they fall on periods of financial hardship, and many of us have no idea what to do when this reality comes to roost in our lives. This guide was put together to suggest some of the most common methods of dealing with indebtedness and how to get the help you need to meet this challenging time.
Seek Out Free Debt Advice
No, this doesn’t mean you should speak to your friends and relatives about what to do with your financial situation. Aside from being embarrassing, it’s also likely they aren’t trained financial professionals and may give you advice based on rumor and speculation. Instead, use one of the many free debt advice groups that are available for people in your position.
Debt Arrangement Schemes
DAS, or Debt Arrangement Schemes, is a free solution for debt management that will help you work out a debt payment programme with your debtors. Through DAS you’re able to protect your assets from creditors while paying off your obligations. Joint debt programmes are available for couples who share a debt.
3 Year Trust Deeds
These are a solution that not many are familiar with that some creditors may be open to. A Trust Deed means that an agreement is formed between you and your creditor to have you pay off a portion of what you owe over a period of three years. Provided that you meet your obligation for that period of time your creditor discharges the balance of the debt. This solution is perfect for unsecured credit cards, overdrafts, and loans.
Sequestration
There are more than 2,000 cases of sequestration in Scotland every year, so if you’re suffering from financial struggles you’re hardly alone. Bankruptcy is the last option for those who are struggling to clear debt from their lives, and it can be a life-saver for those who just can’t find another way out. Before you decide to head down the path of bankruptcy, Scotland requires that you speak to a financial expert about the topic.
Those who are eligible to use the sequestration process include those who have held residence in Scotland in the past year, have not gone through the bankruptcy process in the past five years, and whose debts are more than £1,500.
Roads To Bankruptcy
In most cases of sequestration, Scotland statistics show that it typically occurs because someone realizes their financial reality will not permit them to meet their obligations and are looking for a path out. For some, however, bankruptcy is forced on them by a creditor who apples to push them into sequestration. The two most common tracks taken by the willing debtor are traditional Sequestration and the Minimal Asset Process.
Traditional sequestration requires a £200 filing fee, a certificate of sequestration that is provided by a money advisor or other approved person, and that you are determined to be in ‘apparent insolvency,’ meaning you are unable to meet your debts. The Minimal Asset Process, on the other hand, requires that you have less than £2,000 in assets, and no single item can be worth more than £1,000. Additionally, your car must be worth less than £3,000.
If any of these requirements describe you, then you are eligible to go through the sequestration process and should make an appointment to speak with a qualified money advisor today.