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Home / Sequestration (Scotland) / What debts are not cleared by sequestration?
SEQUESTRATION (SCOTLAND)

What debts are not cleared by sequestration?

Court fines, child maintenance arrears, student loans, and damages awarded in some cases survive sequestration. Secured debts like a mortgage also continue — sequestration only writes off the unsecured shortfall if a secured asset is sold.

Debts that survive discharge

Court fines (criminal fines, road traffic offences) survive.

Child maintenance arrears (Child Maintenance Service or court order) survive.

Student loans (Scottish and cross-UK) survive on their normal repayment terms.

Confiscation orders and compensation orders from criminal proceedings survive.

Debts arising from fraud

Debts obtained through fraud or dishonesty may be declared non-dischargeable by a court on application.

Secured debts

Mortgages, secured loans, car finance, logbook loans continue. The lender retains its security.

If a secured asset is sold and the sale does not cover the debt, the unsecured shortfall becomes a claim and is discharged.

Post-sequestration debts

Only debts existing at the date of the sequestration award are covered. Debts taken on after are your responsibility.

Key takeaways

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