How a Protected Trust Deed Works

Step by Step

How a Protected Trust Deed Works

The process is straightforward and designed to give you a clear, legally-protected path to becoming debt-free.

Step 1

Free Assessment

A licensed Insolvency Practitioner reviews your income, debts, and assets to confirm whether a PTD is appropriate. No charge and no obligation at this stage.

Step 2

Proposal to Creditors

Your IP prepares a formal proposal detailing your monthly contribution and sends it to all creditors. They have 5 weeks to object. Most do not.

Step 3

Legal Protection Begins

Once protected, all creditor contact, interest, and charges stop immediately by law. You have one single affordable monthly payment.

Step 4

Debt Written Off

After completing your 48-month payment plan, any remaining qualifying unsecured debt is legally written off and you receive your certificate of discharge.

In Detail

What to Expect at Each Stage

A closer look at what actually happens - and what you need to do - throughout the process.

During the Assessment (Weeks 1-3)

  • You provide a full list of all debts, creditors, income, and outgoings
  • Your IP calculates your disposable income and an affordable monthly payment
  • All assets - including your home, car, and savings - are considered
  • You receive a written explanation of the proposal terms before agreeing
  • No creditor is contacted until you give the go-ahead to proceed

The Creditor Period (Weeks 3-8)

  • The proposal is advertised in the Edinburgh Gazette
  • All known creditors receive a formal notification pack
  • Creditors have 5 weeks to lodge a formal objection
  • If under one-third by debt value object (or do not respond), the Trust Deed is protected
  • Refer any creditor contact directly to your IP during this period

Once Protected (Months 2-48)

  • All creditor calls, letters, and recovery action must legally stop
  • Your IP collects your monthly payment and distributes to creditors
  • Annual financial reviews ensure your payment remains fair
  • If your income drops significantly, your payment can be reduced
  • Notify your IP of any significant change in circumstances promptly

Approaching Discharge (Months 42-48+)

  • Your IP assesses any equity in your home
  • Equity may be addressed by remortgaging, extending payments, or a lump sum
  • Your IP prepares a final accounting of all payments made
  • A certificate of discharge is issued once all obligations are met
  • All remaining qualifying included debt is legally written off at this point

Trustee fees: Your IP is paid from your monthly contributions - not separately by you. Their fees are agreed upfront and disclosed in the proposal document, so there are no hidden charges.