HELP WITH DEBT
Information about our fees
HELP WITH DEBT
Information about our fees
What is the fee for your debt solution?
Whilst all our advice is free, should you enter into a debt solution with us, there will be a fee charged once your agreement is protected/approved. However, it will be paid from the agreed monthly contribution which you will pay whilst the solution is ongoing.
An affordable monthly contribution is paid for the term of your Scottish Trust Deed. The proposal considered by creditors will include the amount of the agreed monthly contribution which will be assessed on the amount you can reasonably afford. It will be reviewed every twelve months. This contribution covers the running costs of the Trust Deed.
Trust Deed Fees, Costs & Contributions
This can get a bit confusing, so we thought we’d explain using an example of an individual who owes £28,232 contacts us and a Trust Deed is recommended as his best solution.
He can afford £220 per month to offer to his creditors. The term of his Trust Deed is 48 months
Debt Amount: £28,232
Monthly contribution of £180 for 48 months £8,640
Fixed fee: £2,500
% Fee of realisations: £1,828
Trustee’ expenses & disbursements: £1,631
Total repaid by individual (including fees above): £9,140
Total unsecured debt written off at completion: £25,051 (88%)
Expenses and Disbursements shown are inclusive of VAT where applicable.
The monthly fee will cover both the initial work associated with arranging your Trust Deed and the work involved in keeping your Trust Deed running.
The fee also covers any work required by your Trustee. They work with you to draw up your Trust Deed proposal, and can take care of any more serious issues that occur (e.g. asking your creditors about changing your payments if your circumstances change significantly).
Note: It is very important that you keep up your Trust Deed payments, or the arrangement could fail. If it does, you will be liable for the outstanding balance and any costs already incurred.
If the Trust Deed fails the client is not liable for any outstanding balance and any costs already incurred. The client’s creditors are advised that he has failed to maintain the terms of his Trust Deed and that the Trustee will seek his discharge and not grant the client / debtor his discharge.
Any costs incurred are deducted from funds held and if there is a deficit this is written off. Any unpaid contributions remain outstanding.
Debt Arrangement Scheme Fees, Costs & Contributions
If you enter into a Debt Arrangement Scheme (DAS) an application is made for a Debt Payment Programme through us. There is an initial fee – which is normally your first two payments – and then a monthly fee of 15% of each payment you make (this is subject to a minimum of £12 and a maximum of £80). Once the initial fee is paid we will begin the work required to get your DPP approved.
After approval you are required to make your first monthly payment within 42 days. This is the amount you have agreed with Carrington Dean and will include our monthly fee. The rest will be distributed to your creditors.
This will be used to cover the work that’s involved in setting up your Debt Payment Programme.
Your monthly fees pay for the work that’s involved maintaining your Debt Payment Programme, including dealing with any issues or problems that may arise.
We’ll carry out regular reviews of your circumstances to help ensure your Debt Payment Programme remains the best solution for repaying your debts. If at any point we believe it isn’t (if your circumstances change significantly, for example), we can help you to find a more appropriate debt solution for your needs
If your circumstances do change but you can still afford to make a reasonable monthly payment, we may be able to arrange with your creditors for your monthly payments to be reduced accordingly.
Sequestration Fees, Costs & Contributions
We do not charge an initial fee to complete your sequestration application, though a £200 fee must be paid to Accountant in Bankruptcy. If your application is accepted then you will pay a monthly contribution for 36 months as condition of your Sequestration.
This again is best explained using an example, this time we’ve used an individual who owes £8,670 and Sequestration has been recommended as his best solution.
He can afford £220 per month to offer to his creditors. He will make contribution payments for a period of 36 months
Debt Amount: £8,670
Monthly contribution of £220 for 36 months £7,920
Trustee’s Fees: £4,000
Accountant in Bankruptcy’s Fees: £700
Total repaid by individual (including fees above): £7,920
Total unsecured debt written off: £5,540 (63%)
Trustee’s Fees are shown exclusive of VAT.
The Trustee’s fees won’t affect how much you pay each month, or how much you pay in total over the course of your Sequestration, because you’ll be expected to pay only as much as you can afford throughout the period of your sequestration.
We’ll tell you how much the Trustee’s fees will be before you apply for Sequestration. The monthly contribution payment fee will cover all work related to your sequestration.
The Trustee will work with you to complete the necessary paper work for your Sequestration application, and can take care of any more serious issues that occur (e.g. asking your creditors about changing your payments if your circumstances change significantly)
Note: It is very important that you maintain your monthly contribution payment and co-operate with your Trustee. Failure to do so may have serious consequences.