v Which is best a Protected Trust Deed or DMP?

Which is best a Protected Trust Deed or DMP?

If you're struggling with a debt problem and looking for a solution, then you're going to need to understand the options available to you if you're to make the right decision.

And, as you know, making the wrong decision will be an expensive mistake to make. So don't rush the decision. Even if you're being put under pressure by your creditors, it's better to make sure you're happy before you commit yourself.

Personal Circumstances

The answer to which of these two solutions is best will be heavily influenced by your personal circumstances.

Each solution has its good points and its bad points and for you to arrive at the right answer, you'll need to understand the significance of these differences when applied to your personal situation.

Here are the general differences between a Protected Trust Deed solution (PTD) and a Debt Management Plan (DMP).

Legal Status

PTD: The Protected Trust Deed is a legally binding debt solution. On acceptance all creditors are then legally bound by its terms.
Consequently, creditors are legally obliged to freeze interest and charges, stop legal action and refrain from contacting you about the repayment of your debt.

DMP: Because a Debt Management Plan is an informal solution it is not legally binding and, consequently can't provide any of these assurances.
Instead an approach would have to be made to the creditors to see if they would agree to any of these requests.


PTD: A Protected Trust Deed generally has as a fixed term of 4 years, although this can be extended if it benefits the applicant. After the pre-agreed time has elapsed the PTD finishes.

DMP: A Debt Management Plan has a repayment term determined by the size of your debt and the amount you can afford to repay. All Debt Management Plans must continue until all the debt has been repaid.

Debt write-off

PTD: A major benefit to having a fixed term repayment being that only a small proportion of your debt will be repaid during the term. Any outstanding debt remaining at the end of the trust deed term must be written-off by the creditors.

DMP: The Debt Management Plan does not provide any debt relief or forgiveness. There is not debt write-off and the whole debt must be repaid.


PTD: A Protected Trust Deed is an alternative to bankruptcy and, once protected, creditors forfeit their right to force bankruptcy.

DMP: A Debt Management Plan cannot protect against legal actions taken by a determined creditor which could, ultimately lead to bankruptcy.


PTD: A Protected Trust Deed has a degree of flexibility if required, especially if you experience payment problem which, at the sole discretion of your Trustee, can include reductions to your payments or even a payment break if necessary. But the length of the trust deed is pre-set and the terms and conditions are legally binding.

DMP: Because they are informal arrangements, Debt Management Plans are very flexible. You are at liberty to increase or decrease your payments at will.

Fees and Costs

PTD: All the fees and costs are included within your affordable monthly payment and do not add any extra time to the term. As a result, your creditors have to stand the cost of your trust deed.

DMP: A Debt Management Plan's costs must be paid by the applicant.

Debt levels

PTD: Protected Trust Deeds can accommodate any debt level above £10,000, usually, the bigger, the better.

DMP: Debt Management Plans tend to be better at dealing with smaller debt levels, where there is a good chance that your personal circumstances might improve enough to repay the debt more quickly.


PTD: A Protected Trust Deed will protect you from having to sell your home, although you will be expected to release equity from your home under the terms of your trust deed.
Please Note: Professional guidance is advised when trying to understand how a Protected Trust Deed will affect your equity. Call 0800 088 7502 to talk to an adviser.

DMP: As we've already mentioned, a Debt Management Plan is an informal solution, so you're not obliged to disclose your assets.

Size of problem

PTD: A Protected Trust Deed has a repayment term of, usually, 4 years. If you have sufficient resources to make a full repayment within 4 years then a Protected Trust Deed would cease to be suitable.

DMP: If you reasonably expect to be able to pay back your full debts within a reasonable time frame, then a Debt Management Plan will allow you to do so.

Take Professional Advice

The brief comparison above demonstrate quite clearly where the differences between these two solutions lie.

However, it'll be down to you to determine which solution will best suit you and your personal circumstances.

It may be a very difficult choice for you to make, and one that deserves to be given serious consideration.

That's why it is always a good idea to talk to a professional debt adviser before you commit yourself.

If you would like to have a chat about your circumstances, or discuss any of the points above, simply call 0800 088 7502

Alternatively complete the form below and one of our adviser will call you back at your preferred time.

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