What is Sequestration?

Sequestration (Bankruptcy in Scotland) is a formal insolvency process, whereby a Trustee takes control of your estate and will deal with the creditors on your behalf. It is often an alternative to a Trust Deed in Scotland as in both cases you make affordable monthly payments for a period of 4 years.

You might choose sequestration instead of a trust deed because you don’t have enough disposable income for a trust deed.

With sequestration, the trustee has a responsibility to investigate whether assets, including any property, should be sold to raise funds for creditors. However, in practice Trust-Deed.org would be very unlikely to recommend sequestration if your property was at risk, and would always inform you in advance if this was a possibility.

Depending on your circumstances you may be required to make a contribution for a period of four years. Any assets of value which may include the equity in your home have to be realised. Provided you co-operate fully, the Accountant in Bankruptcy may grant their discharge at the end of one year. Therefore, you have a duty to continue to co-operate with your Trustee and to pay a contribution for the remainder of the sequestration period.

An application for sequestration which costs £200 can be submitted to the Accountant in Bankruptcy.

Do you Qualify?

Should you need to contact us, here are our details.

My Trust Deed
368 Alexandra Parade, Glasgow
Glasgow
G1 1RW

0141 406 3150
info@mytrustdeed.co.uk

On this page

What is Sequestration?

Sequestration (Bankruptcy in Scotland) is a formal insolvency process, whereby a Trustee takes control of your estate and will deal with the creditors on your behalf. It is often an alternative to a Trust Deed in Scotland as in both cases you make affordable monthly payments for a period of 4 years.

You might choose sequestration instead of a trust deed because you don’t have enough disposable income for a trust deed.

With sequestration, the trustee has a responsibility to investigate whether assets, including any property, should be sold to raise funds for creditors. However, in practice McPherson Noble would be very unlikely to recommend sequestration if your property was at risk, and would always inform you in advance if this was a possibility.

Depending on your circumstances you may be required to make a contribution for a period of four years. Any assets of value which may include the equity in your home have to be realised. Provided you co-operate fully, the Accountant in Bankruptcy may grant their discharge at the end of one year. Therefore, you have a duty to continue to co-operate with your Trustee and to pay a contribution for the remainder of the sequestration period.

An application for sequestration which costs £200 can be submitted to the Accountant in Bankruptcy.

How does Sequestration work?

1

Consult an Insolvency Practitioner or approved Money Adviser who will clearly explain the sequestration process. They should advise you whether sequestration is an appropriate solution for you. For an indication of minimum monthly payments required for different solutions try our Debt Calculator. A member of our team will contact you shortly after submission to go through an in depth income and expenditure to provide you with all the options, but there is no obligation to make use of this service. To submit a sequestration application you must:

have lived in Scotland for more than six months
have debts of more than £1,500
not have been sequestrated in the last five years

2

Your application will be submitted to the Accountant in Bankruptcy by the Insolvency Practitioner or Money Advisor. The Accountant in Bankruptcy will award sequestration, set the level of your contribution, which may be nil and appoint a Trustee. The Insolvency Practitioner who submits your application is generally appointed as your Trustee. Your application must contain either evidence of your creditor’s agreement or a Certificate of Sequestration and the cost of the application which is £200.00.

3

Once sequestration has been awarded, your Trustee will contact you to discuss your affairs and to discuss the way in which your assets will be realised, if this is appropriate.

Your Trustee will contact your creditors to advise them that sequestration has been awarded and contact them on your behalf in the future.

4

Provided you co-operate fully, the Accountant in Bankruptcy may grant your discharge at the end of one year. However, although you may have been discharged the sequestration process does not come to an end. You must continue to co-operate with your Trustee whilst he is in office, normally, for a further three years. If your Trustee has assets to realise he will remain your Trustee until he has done so.

If you have paid a contribution you will continue to pay this as set out in your contribution order.

See if you are Eligible today!

Need to speak to someone?
0141 406 3150

Advantages and Disadvantages

Advantages

Once you have been sequestrated, creditors are unable to pursue you or take any legal action against you to recover what they are owed.
The Insolvency Practitioner will contact your creditors, removing a source of stress.
Provided you co-operate fully, the Accountant in Bankruptcy may grant your discharge at the end of one year.
If you are receiving welfare benefits, these will not be classed as income for the purpose of calculating your monthly contribution.

Disadvantages

Your credit rating may be affected and may affect your ability to obtain credit in the future.
If you are a homeowner and have equity in your property, or you have any other assets of significant value, your Trustee will be required to realise them. However, it may be possible to do so without the need to sell your home. If this is an issue the Trustee may suggest a Scottish Trust Deed instead, if this is affordable.
Your Sequestration will be displayed on an online Register of Insolvencies which includes details of all “live” cases plus those that were discharged in the past two years.

Why choose Trust Deed.org

We are experts in this field and well-established as Scotland’s leading Sequestration company. Our friendly team welcomes new enquiries from people who either need help with their financial difficulties or wish to learn more about Sequestration. We are based in the heart of Glasgow and would be happy to make an appointment at a time that suits you.

Other Solutions

Feel a Sequestration is not for you? Well we have many different debt solutions that cater to different debt levels and circumstances. Please click the links below.