A trust deed is a formal debt solution and can be voluntary or protected.

In a voluntary trust deed, an agreement is made between a debtor and their creditors to repay part, or all of what they owe. Under a voluntary trust deed, the debtor's rights to the things they own are transferred to a trustee who will sell them to pay creditors part of what is owed to them. However, a voluntary trust deed is not binding on creditors.

If creditors agree to the terms of a trust deed, it then becomes protected. A protected trust deed is a special kind of trust deed which is binding on all creditors and means they can take no further action to pursue the debt or to make the debtor bankrupt, as long as the debtor complies with the terms of the protected trust deed.

Signing a trust deed is a serious step and debtors must be sure that they understand what they are signing.

Free, impartial advice on the options available can be obtained from Citizens Advice Scotland, Money Advice Scotland or local authority money advisers.