Secured debt, like mortgages, cannot be included in a trust deed. If mortgage payments are missed, the property may still be repossessed.
If the person in debt owns their house or other property, it may be sold to pay back their debts. The trustee will do their best to prevent the house being sold on the open market, including exploring options to release the equity in the house or allowing a friend or relative to buy out the debtor’s interest in the house, but if there is no other way to raise the funds the house will be sold.
It may be possible to exclude a house from a trust deed by speaking to the mortgage provider and getting the agreement of the creditors in the trust deed. If the creditors do not agree to a trust deed which excludes the property, there is nothing preventing the offer of a second trust deed which does include the property. If a property that was excluded is sold within four years of the signing the trust deed, any money that is not used to pay off the mortgage of the property must be added to the assets used to pay back the creditors.