New guidance designed to improve communications between creditors and insolvency practitioners, and establish transparency in the process is to be introduced in early 2012, says Scottishtrustdeed.co.uk.
The guidance will form a new Preferred Best Practice code and will be created by the Accountant of Bankruptcy (AiB) with the assistance of creditors and insolvency firms.
By helping facilitate a single approach to dealing with Trust Deeds in Scotland, the guidance will ensure there is a balance between the needs of the debtor and the rights of the creditor, and that the process from start to finish is fit for purpose.
There are many issues with Trust Deeds that can prove confusing to someone in debt. The length of set up is a typical example – there is a perception that the process is very quick, while in reality it can take 6-8 weeks, leaving many individuals feeling panic and worry that things have gone wrong and they will not be accepted. More problems can occur at the end of the Trust Deed term due to the length of time and administration involved.
A spokesperson for Scottishtrustdeed.co.uk, said: “England and Wales already have this type of legislation for their own version of Trust Deeds known as Individual Voluntary Arrangements (IVAs). The AiB wants to bring Scotland in line with the rest of the UK.
“In a nutshell, these guidelines will put the debtor at the centre of the whole process, making sure they understand what is happening and why. The paperwork can be complex so there is a need to ensure they fully grasp what Trust Deeds in Scotland entail, not to mention what could happen in future if they want access to credit and banking facilities. However, the creditors cannot be forgotten in this, and the guidelines will help ensure they get a fair and reasonable amount of money back within the timescales of the Trust Deed.”
The guidelines have specifically been created so changes to existing legislation would not be needed, increasing the speed at which the guidelines could be adopted by the industry. However, the guidelines still require approval by ministers, and are due to be heard in the autumn, with release and implementation slated to take place in early 2012.
“These guidelines are long overdue and will bring a new depth of professionalism to the Trust Deed Scotland industry,” said the spokesperson. “It will help root out some of the unfair practices that currently exist. When people seek to enter a Trust Deed, they will have a benchmark to assess their insolvency practitioner and other individuals associated with the process against to ensure they are being treated fairly.”
For more information about the new guidelines, as well as in-depth information about Trust Deeds in Scotland, visit our Scottish Trust Deed website for more information.
Contact Name: David Baddeley
Address: Pentagon Centre,
36 Washington Street,Glasgow,G3 8AZ
Contact No: 0141 345 2901
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