What is a Minimal Asset Process? (MAP)

A Minimal Asset Process is a form of Sequestration (bankruptcy) for residents of Scotland with no assets or surplus income to realistically repay their debts and ultimately become debt free. A Minimal Asset Process lasts for 6 months, at the end of which, if your financial situation is unchanged, your debts are officially written off.

Is a Minimal Asset Process right for me?

If you don’t have many assets and your income is low, a MAP may be worth considering as an alternative to Sequestration. Typically, people who apply for a MAP shouldn’t own property or a vehicle, or have assets valued at more than £2,000. They should also have a disposable income (after household bills and other essential expenses are accounted for) of no more than £75 a month. In addition, their outstanding debts must total less than £25,000.  

Once you enter a MAP, all charges and interest from creditors are frozen for 6 months. When you reach the end of this period, your finances will be reviewed. If they have improved, you’ll be expected to start repaying your debts again. If not, your debts will be written off.  

When should I consider a Minimal Asset Process?

If you have debts up to £25,000 that you feel you can’t pay back and have little to no assets or property of your own to contribute towards repayments, a MAP may be a preferable choice to Sequestration.

A MAP may be a good option to consider if you feel you have no reasonable means to repay your outstanding debts.

How do I apply for a Minimal Asset Process?

1. Before applying you’ll need to seek advice from an approved financial advice company. An application for a MAP cannot be made without this initial consultation. You’ll need to review your financial situation, who you owe money to, details of your debts, cost of living and expenses. The sooner you give this information the sooner your application can begin.
2. To apply for a MAP, you’ll need to pay a nominal fee to the Accountant in Bankruptcy of £50. You can make this payment in increments, but it must have been paid in full in order for your application to proceed. However, if you are subject to certain financial criteria, this fee can be reduced to £0.
3. Once you have entered your MAP, you will have 6 months free from debt repayments and your creditors won’t be able to contact you. All charges and interest will be frozen. At the end of the MAP, if your finances have improved, you will need to start repaying your debts again. If your situation is unchanged, your debts will be written off.

What debts are covered by a Minimal Asset Process?

Almost all debts are covered under a MAP, these include:

• Credit card
• Overdraft
• Overdue utility bills  
• Rent arrears
• Personal loan
• Benefits overpayments
• Council tax
• Telephone and broadband bills

Am I eligible for a Minimal Asset Process?

As a Minimal Asset Process is a scheme designed to help people with little chance of repaying their debts, you will need to meet set qualifying criteria to apply. These include:

• Having debts up to £25,000
• Not owning property or land
• Not owning a vehicle worth more than £3000
• Not having any assets worth more than £2000
• Having less than £75 in disposable income each month
• Being a resident of Scotland
• Being unable to repay your debts
• Not having been on a MAP in the last 6 years
• Not currently on any formal insolvency solution (IVA, Sequestration)

Living with a Minimal Asset Process

A MAP can give you breathing space from your debts and creditors. However, it’s important to be aware that, like most debt solutions, it will have an impact on your credit score and your ability to take out loans in the future.

Your credit score will be negatively affected for 6 years following the start date of your MAP. Though it is certainly something to consider, this negative score could be less so than numerous alternative debts and arrears actions that could have been taken against you otherwise.

It will be difficult to receive more credit during your MAP, as your disposable income is confirmed as less than £75, so you probably wouldn’t qualify for repayment requirements.

Can I get a mortgage while on a Minimal Asset Process?

Under a MAP, it is very unlikely you will be able to get a mortgage, as your negative credit score and lack of disposable income will most likely make you ineligible for a lender’s affordability criteria.

Getting a mortgage while on a MAP would also not be advantageous for you as it would make your MAP ineligible, and you would be expected to resume repaying your prior debts. 

As with all debt solutions, it’s generally advised to wait until your debt plan has ended before attempting to take on further credit.

Will a Minimal Asset Process stop bailiffs?

Once you start a Minimal Asset Process, your creditors must cease all contact and attempts to chase payments. This includes visits from bailiffs. During your MAP, you won’t have to interact with your creditors directly. 

However, at the end of the 6-month period of your MAP, if your finances have improved, your creditors can start contacting you for repayments again. They can also apply any charges or interest that they previously would have added.

Alternatives to a MAP?

There are a number of debt management solutions that might work better for you than a Minimal Asset Process (MAP). From Sequestrations (Bankruptcies) in Scotland, to Debt Management Plans and Debt Relief Orders, it is important that you understand your options. All debt solutions have their advantages and disadvantages, and the right option for you will depend on your current and future financial situation.