Write Off Unaffordable Unsecured Debts With A Scottish Trust Deed...

Why you SHOULD NOT pay UPFRONT set-up fees...

Fear can make you vulnerable when you’re desperate for debt help. An unmanageable debt makes you attractive to companies who provide unethical practices, and in your worried state you can fall prey to their tactics, which you would ordinarily spot a mile away and avoid. One such unethical practice is Trust Deed upfront set up fees.

There are probably as many good ethical Trust Deed Companies as there are bad, but luckily whether they charge set-up fees is usually a good indicator of which one is which.


Because you should not pay anyone to set up such a scheme - it is completely unnecessary, and we only recommend using companies that DO NOT charge upfront setup fees. So what are some of the tactics unethical companies use to try and make you pay more than you need to when setting up a Trust Deed.

1. Booking fees

If you ring a company to get advice or book a meeting with a specialist Money Adviser, and are told you have to pay a booking fee first, don’t be fooled. The advice should be free advice. Don’t hand over your debit or credit card details over the phone and find another company instead.

2. “But fees are standard practice.”

This old chestnut comes up quite often. A Trust Deed Company will tell you that you have to pay an upfront fee for their service and that it is quite normal to do so. Not true. What they are saying is that you have to go further in debt by paying their set up fees, when in fact they know very well you can obtain the set-up service for free from ethical companies.

3. Hiding the upfront set up fees in the small print

It is unlikely you will be told about set-up fees unless you ask. Instead the fees will be hidden in the small print of the application pack you are sent. Standard unethical practice is a clause that refers to your first few payments going straight into the pockets of the Company as fees. So for the first two to three months your payments will be delayed while the Company helps itself to your money.

4. “Try a debt management plan first”

Unethical Trust Deed Companies may try and persuade you to do a Debt Management Plan (DMP) for a few months before taking on a Trust Deed. They may even claim that with them a DMP could help you avoid looking any further for debt help. It won’t. What it will do is allow the company to take a few ‘fee payments’ from you and then charge you a percentage every month for the duration of the DMP.

5. They want you to pay for a survey

If you own a property, sooner or later you will have to have a valuation survey done on it as part of the process for applying for a Trust Deed. This should be free, but some unethical companies will still try and extract equity survey fees.

6. Pay for your ad in the Edinburgh Gazette

A short notice in the financial trade magazine the Edinburgh Gazette is a required part of setting up such a scheme, and its purpose is to invite creditors to contact your Insolvency Practitioner if they have any queries. You don’t pay for this, but some enterprising unethical companies try and turn this into a money-spinner. Don’t pay.

7. “Double glazing” Trust Deeds

Just when you’re reeling for having to deal with nasty creditors, an unethical Trust Deed Company will put the boot in and send a high-pressure salesman to your home to sell you a Trust Deed laden with fees and charges.

These people won’t want to leave your house until they’ve got you to sign for services you probably don’t want or need, and they won’t bother with impartial financial advice. They have a product in mind to sell you which will probably leave you considerably poorer and no closer to getting rid of your debts.

The seven points above may make you think that there are no Trust Deed fees at all. There are, but these are fees for the monthly administration of your account, such as dealing with creditors and sending your payments out. They are legitimate fees for an actual service and have been agreed by you and your creditors beforehand. However, they come much later in the process, not upfront and in a manner likely to delay your Trust Deed from being paid.

So, any company that tries to get cash from you before the Trust Deed is set up when you have very little income and are coping with an awful lot of stress and worry is highly unethical.

The actual fees involved

Inevitably there are fees involved to setup such arrangements such as Trust Deeds, Debt Arrangement Schemes and Sequestrations. See here for more information on the exact fees involved.

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