Sequestration is the term often used in Scottish law for bankruptcy. The consequences of sequestration can be extremely harsh – including loss of assets and property – and therefore should only considered as a last resort and after talking to a trained debt specialist, there is often a different way to tackle your debts.
Please Note: Debt Assist UK only provide debt advice; we do not directly provide any financial solutions ourselves. We will talk you through your available options and if appropriate, we can offer you a no-obligation referral to a regulated debt solution provider, from whom we may receive a referral fee. Some debt solutions involve fees to you – these fees may differ based on the circumstances of your individual situation, but will always be explained to you by your chosen solution provider in writing before you decide to take up their service(s).
Can I Get Sequestration?
Sequestration is a form of insolvency that is available to residents of Scotland. If you owe more than £3,000 and can’t repay your debts in a reasonable time, then sequestration may be the option for you. If your assets, such as car and house, are worth more than your debts, then it may be best to look at alternative solutions, as your assets could be sold to pay off your debts. Sequestration can also affect your job, e.g. you will no longer be able to act as a company director.
Pros and Cons of Sequestration
As with all debt solutions there are both pros and cons to sequestration, for more in depth advice contact our trained advisers on 0800 029 3992.
The main benefit of sequestration is that your unsecured debts are written off, although you may to make a contribution towards repayment. The fact that your creditors can longer chase you for payment also helps to reduce the stress that debt can bring.
However, as we have mention, sequestration have serious consequences and is not something that should be rushed into. Any assets you own may be sold in order to release funds to go towards your debts, any excess earnings you make after paying for essentials, could be taken to pay for the sequestration, it can have a negative impact on your current and future career, and you will find it difficult to obtain credit in the future as it will have a negative impact on your credit rating.
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How Long Does Sequestration Last?
Sequestration normally lasts for just one year, and during time you cannot apply for more credit. Your name will be recorded on the public Register of Insolvencies (RoI) for five years and the sequestration will remain on your credit record for six years.