Topic 11 Scotland

Question 1

Insolvency solutions in Scotland

Answer 1

Debt arrangement scheme

Trust deed

Map minimal asset process bankruptcy

Sequestration (term for bankruptcy in Scotland)

Question 2

Debt arrangement scheme

Answer 2

Run by the Scottish government and is similar to the debt management plan . People must owe money to one creditor or more and must be able to afford some repayments to be eligible for a debt payment program . They make payments to the program which are shared among creditors

Question 3

Trust deed

Answer 3

A trust deed is similar to an individual voluntary arrangement IVA . A insolvency practitioner helps people who are insolvent to make repayments they can afford and after four years any outstanding debt is written off

Question 4

Minimal assist process (MAP) bankruptcy

Answer 4

Allows you to write off debts that you are unable to pay off in a reasonable time you pay a fee and if you are eligible, your debts may be written off in around 6 months to be eligible:

Your are on low income

Your debts are between £1500 and a specified higher amount which is usually £17000 but was raised temporarily to £25000 due to covid

You are not a homeowner

Any vehicle that you own is worth less than £2000

You have not been made bankrupt in the last 5 years

If you made bankrupt you remain of the public register for 5 years

Question 5

Sequestration

Answer 5

A person who owes more than £3000 and has not been bankrupt in the last 5 years can apply voluntarily. A creditor can apply for a debtor’s sequestration if they are owed more than £3000 and have got court judgments for payment against the debtor the courts actions are called a decree and a charge for payment , and a summary warrant. Sequestration cost 150£ and usually last 12 months in the process the debtor transfers the assests to a trustee or a insolvency practitioner who manages the sale of assests