Minimal Asset Process (MAP)

A MAP is a formal debt solution possible only in Scotland (like DRO in England) aimed at those with a low income and few assets. MAPs were introduced on 1st April 2015 as a new route for those in debt. A MAP is generally cheaper and more straightforward when compared to a solution such as Sequestration/Bankruptcy. The only way to apply for a MAP is through an approved money advice organisation such as StepChange Debt Charity. It is free to set up a MAP when approaching such organisations, however it is not free to apply. 

Criteria for a MAP

  • You must have a minimum debt level of £1,500 
  • You must not have debt that exceeds £17,000 
  • You must not own any land or property
  • If you have assets, the total value of assets combined must not exceed £2,000 in value 
  • You must not have any single assets that exceed a £1,000 value (aside from a car)
  • If you own a car, its value must not exceed a value of more than £3,000 and you must provide evidence of its utility, i.e. to travel to work
  • You have no disposable income to which you can contribute 
  • If you are on benefits, you must only have been receiving them for a minimum of six months 
  • If you have been made bankrupt within the last five years you cannot apply 
  • Make a payment of £90 payable to a bankruptcy accountant 

Advantages

  • If all conditions are met, you may be released within a period of no more than six months 
  • The fee is cheaper (£90) than other forms of bankruptcy such as sequestration which is £200 
  • You do not need to make any payments towards a MAP as you do not have a disposable income 
  • Creditors are not allowed to contact you while you are subject to the MAP and will not contact you following completion of the MAP 
  • Interest and charges will not increase as your creditors will not be permitted to do so if subject to a MAP 
  • Relatively easy set up process 

Disadvantages

  • Your credit rating will be affected for six years from the day your MAP bankruptcy begins 
  • Some private landlords may evict tenants or not renew a tenancy agreement if you become bankrupt 
  • If you are self-employed, bankruptcy can make it difficult to trade and get credit for goods and services 
  • You will not be able to take a mortgage 
  • You will not be able to obtain new lines of credit and may find it difficult to obtain credit when released from the process 
  • Future job applications may be hindered as some employers will not allow staff to enter a formal debt process 
  • Failure to adhere to the conditions of a MAP may result in a Bankruptcy Restriction Order which prolongs the term for up to 15 years

What debts can be included within a MAP?

  • Arrears on household bills such as rent, gas, electric, telephone and Council Tax
  • Consumer debts such as credit card debt, payday loans, overdrafts, catalogues or store cards
  • Benefit overpayments, unless they were due to fraud
  • Hire purchase (HP) or conditional sale agreements
  • Items bought on finance, including anything bought on a buy-now-pay-later agreement
  • Loans from friends or family 

What debts won’t be written off within a MAP? (You must keep paying them)

  • All student loans (old and new style)
  • Magistrates' court fines
  • Debts to the child maintenance service or CSA
  • Social fund loans
  • Criminal fines (including debt incurred under the Proceeds of Crime Act)
  • Claims against you for damage or personal injury
  • TV licence arrears

MAP procedure

  • If you wish to apply for a MAP Bankruptcy you must consult an approved money adviser who will assess your income and expenditure using the Common Financial Tool. StepChange can help with MAPs.
  • You will also have to pay an application fee of £90 and await a decision from the official receiver.
  • The Accountant in Bankruptcy (AiB) is responsible for administering the process of personal bankruptcy and acts as trustee in all MAP cases.

Considerations
Depending on your circumstances:

  • Your bank is likely to close/freeze your account 
  • Your employment may be affected. Check your contract for mention of bankruptcy or insolvency 
  • Private landlords may evict tenants (especially those in rent arrears)
  • If self-employed, MAP makes it hard to trade, especially if credit is used to pay for stock or services 

 

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