Today in Ireland, there are 30,000 homes in danger of repossession. Whilst Government action is being discussed, it is obvious that this is action is of utmost importance to deal with this serious situation and to assist these 30,000 homeowners.
Up until December 2012, bankruptcy was the only option available to people in this situation. Then, the Personal Insolvency Act 2012 was introduced and became law.
The Act introduced three new debt resolution mechanisms to help mortgage-holders and other people with unsustainable debt to reach agreements with their creditors. These mechanisms offer different solutions to people in different situations.
The mechanisms introduced by the Personal Insolvency Act are:
A Debt Relief Notice (DRN) to allow for the write-off of debt (generally unsecured and in some cases secured) up to €20,000, subject to a 3-year supervision period.
A Debt Settlement Arrangement (DSA) for the agreed settlement of unsecured debt, with no limit involved, normally over 5 years.
A Personal Insolvency Arrangement (PIA) for the agreed settlement of secured debt up to €3 million (though this cap can be increased) and unsecured debt, with no limit involved, normally over 6 years.
However, with so many homeowners facing the possibility of repossession – are these mechanisms enough?
If you find yourself in this situation or if you’re struggling to pay your debts, we would urge you to contact us to talk things through. We will encourage you to make a personal statement of your finances and help you get the financial advice you need.
We will advise you on the option that is right for you and then help you find the appropriate resolution.
For a Debt Relief Notice, your application must be made through an Approved Intermediary (AI) e.g. MABS.
For a Debt Settlement Arrangement or a Personal Insolvency Arrangement, you must apply through a Personal Insolvency Practitioner (PIP).
See summary below:
You are not alone! The first step? Contact us to help point you in the right direction.
Other useful contacts:
The Insolvency Service of Ireland (ISI) www.isi.gov.ie
Alice Shanahan (P.I.P) www.burns-shanahan.ie
Kerry O’Neill (P.I.P) and Eric Hendy (P.I.P) www.rhendy.ie