When you’re faced with a new situation, chances are good that you want to honestly explore the pros and cons as carefully as you can. The consequences of not getting it right can be severe, especially when your family is concerned. But if you’re struggling to take care of debt, you might feel that there’s really no way that you can get things turned around. Thankfully, you don’t have to feel like that forever. There is always a chance to turn things around and get everything taken care of. Lets take a look on pros and cons of having a trust dead.
The benefits of a trust deed are actually quite straightforward — you will be able to call off the creditors. If they agree to the terms of the trust deed, then that’s all there is to it. They can’t go back later and be upset about the terms, or try to take additional legal action against you. This is also an alternative to sequestration, the Scottish equivalent of bankruptcy. Going bankrupt is not something that any one wants to do.
A trust deed that’s protected is legally binding to all creditors, and your monthly contribution will be as affordable as possible. If your circumstances were to change due to job loss or a salary reduction, your terms would also be modified so that your payments are still manageable. It’s all about getting you back on your feet and giving you the chance for a better life. It is obvious that you will need to work as hard as possible to maintain the agreement. This is not going to be a 3 year period where you get to do anything that you want. Indeed, you will have to be strict with your budget and treat this as a priority before anything else. That’s the only way that you’re going to be able to move forward.
There are some cons that you need to be aware of as well. As mentioned earlier, this is an agreement that’s legally binding. If you decide that you’re going to skip payments and you don’t work things out with your trustee, you’re going to end up having the trust deed terms backed out and you will need to actually pay the remaining balance, plus any fees that are applicable. It can be a very costly situation to find yourself in.
Even if you do finish the program on time and properly, your credit is going to be in shambles for a while. It will be very difficult to get credit after, but that doesn’t mean that it’s impossible. You will just have to build your credit slowly and carefully. That’s the real key to success, anyway — good luck!