SThe process of Sequestration in Scotland was modernised in 2008, again in November 2010 and most recently April 2015. These changes have made Sequestration a viable debt relief solution for individuals in financial distress, and access to Sequestration is now available to anyone unable to pay their debts as they fall due.
How would this affect me?
When applying for sequestration you will have to take into account the application fee of either £90 or £200 which is dependent upon your circumstances. Any assets that you own such as your home or car will need to be taken into consideration and may need to be sold to pay back your debts.
Upon award of your sequestration you can be asked to make a monthly payment for 48 months.
What are the advantages of Sequestration?
- You can be debt free in a relatively short amount of time.
- If you are eligible for sequestration you do not need the approval of your creditors or any other party.
- After sequestration has been agreed upon by all parties, your creditors can no longer take legal action against you or pursue you for debt repayments.
What are the disadvantages of Sequestration?
- Some assets could be sold to help pay off your debts.
- It may affect your work - you cannot act as a company director.
- Sequestration will remain on your credit file for six years.
Who is Eligible for Sequestration?
To be eligible for Sequestration, you must:
- Be a Scottish Resident.
- Be able to pay the £200 application fee.
- Be unable to pay off debts to their creditors within a ‘reasonable timeframe’.
- Owe at least £1,500 of unsecured debt.