What Is Sequestration?

Sequestration is essentially the Scottish version of bankruptcy. The laws involved are very similar to the bankruptcy laws in England, Wales and Northern Ireland. In simple words, sequestration is a form of insolvency designed to be used only as a last resort and when an individual is genuinely unable to meet their unsecured debt obligations in any way, and is unlikely to ever be able to.

Sequestration can be declared voluntarily by an individual who wishes to start afresh, Creditors can also force a party into sequestration in order to see debts they are owed repaid partially or in full.

A creditor can follow this route if they are owed at least £3,000, which is the minimum threshold of debt required to sequestrate an individual.


  • Usually customers will be free of their unsecured debt after 12 months. But if customers can afford to do so they will need to make payments under the Sequestration for up to 4 years
  • Unsecured lenders can’t contact or chase customers for payments


  • You may lose full control of your financial affairs including your bank account and any assets during the period of the sequestration
  • Certain professionals are barred from practising if they are made bankrupt

Please note that your credit rating will be affected if you enter Sequestration.

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