PERSONAL INSOLVENCY
Personal Insolvency Legislation covers the individual, sole trader and partnership where the person or persons are exposed to excessive bank debts, overextended creditor facilities and/or Revenue liabilities.
Options for individual debt problems include:
Informal Arrangements:
Irish Insolvency Solutions will secure you a negotiator to negotiate with your creditors to arrange alternative acceptable repayment options
Debt Relief Notices (DRN)
Individuals may apply for DRN’s through MABS (Money Advice and Budgeting Services) or FLAC (Free Legal Advice Centres). These are for unsecured debt up to €35,000, they offer 3 year protection through which agreed repayments are maintained – if achieved, the remnant gets written off. This solution is suitable for credit card and unsecured loans up to €35,000. We believe that this process is cost effective and straight forward at MABS or FLAC.
Debt Settlement Arrangements (DSA)
Where there are unsecured debts in excess of €35,000 a DSA may be suitable. The DSA is prepared by a PIP (Personal Insolvency Practitioner) who mediates between debtors and creditors to secure an agreed repayment structure that will last over a term of 5 years. Once maintained and all terms and conditions are met, the debtor(s) will stand discharged from the remnant of debts covered by the DSA, and can look forward to a brighter future.
Personal Insolvency Arrangement (PIA)
Where the debts under pressure include secured debt under €3,000,000 (more in some circumstances) and/or unsecured debt, a PIA is probably the solution needed. A PIP will mediate between debtor(s) and creditors to propose a repayment structure acceptable to all. This PIA would be repaid over a period of six years. When successfully completed, all the unsecured debt remaining is discharged and the secured debt is reduced as agreed in the PIA origin agreement. This frees the debtor(s) to face a certain future free from debt stress.
Note – a PIA does not usually demand the disposal of the family home
Personal Insolvency Arrangement – Brief Guide
Personal Insolvency Arrangement – Detailed Guide
Note – All debtors availing of DRNs, DSAs or PIAs will be recorded on a publicly accessible register
Bankruptcy
A process where all of the property or assets and income of an individual who is unable or unwilling to pay their debts, are put under the control of an Official Assignee who takes responsibility for disposing of the person’s liabilities in an orderly fashion. The debtor’s interest in the family home will need to be sold and the proceeds distributed to creditors (after costs, expenses and court fees). In many instances the debtor’s spouse can buy the debtor’s 50% interest in the family home in agreement with the OA. The original term for bankruptcy in Ireland was 12 years but was reduced to 1 year from January 1st 2016 under the 2015 Bankruptcy (Amendment) act.
At Irish Insolvency Solutions:
| Arrangement | Type of debt covered | Value | Duration | Apply through |
|---|---|---|---|---|
| Debt Relief Notice (DRN) | Unsecured (and secured in certain cases) | Up to €35,000 | 3 years | Approved Intermediary (AI) |
| Debt Settlement Arrangement (DSA) | Unsecured | No limit | 5 years (+1) | Personal Insolvency Practitioner (PIP) |
| Personal Insolvency Arrangement (PIA) | Unsecured and secured | No limit on unsecured up to €3m secured (though cap can increase if agreed) | 6 years (+1) | Personal Insolvency Practitioner (PIP) |