INSOLVENCY

Insolvency – At Regnad Professional Services If you are unable to pay your bills, loan repayments, mortgage or other debts as they are due, you are insolvent. The Personal Insolvency Act 2012 introduced three new debt solution options and reduced the bankruptcy period from 12 years to 3 years; a new bankruptcy term of 1 year was introduced in December 2015. The Personal Insolvency (Amendment) Act 2015 introduced further new measures to address the problem of personal debt in Ireland.

The options available to people in financial difficulty are:

1. Debt Relief Notice (DRN) debts below €35,000.

If you have debts of less than €35,000, a low income and few or no assets, you may apply for a Debt Relief Notice (DRN) through an approved intermediary (AI). A list of AIs can be found on the Insolvency Service of Ireland’s website, check ours out here: www……………

read more……….

• The DRN could include secured debts and unsecured debts, such as credit card loans, utility bills or personal loans.

• A DRN lasts for three years – or less if half of your debts are paid off.  After this time any debts that you owe will be written-off i.e. no longer due.

• You are protected while your DRN is in place and creditors, such as banks, cannot take any legal action against you.

• You can only have one DRN in your lifetime

2. Debt Settlement Arrangement (DSA) unsecured debts, such as credit card or personal loans.

If you have unsecured debts, such as credit card loans or personal loans, a Debt Settlement Arrangement (DSA) may be a debt solution option for you.

read more……….

• A DSA lasts for five years – or in some cases six years. Any outstanding debts that you owe after this time will be written-off i.e. no longer due.

• A DSA allows you to pay off as much of your unsecured debt as possible.

• You are protected while your DRN is in place and creditors, such as banks, cannot take any legal action against you.

• You can only have one DSA in your lifetime.

3. Personal insolvency practitioners (PIPs) are licensed by the Insolvency Service of Ireland (ISI) to make an application for a PIA on your behalf. We here at Regnad Professional Services have a licensed PIP.

How a PIP Will Help You to Find a Solution to Your Debt Problem

1. The PIP will help you to complete a prescribed financial statement (PFS) outlining your financial situation.

2. The PIP will submit your application to the Insolvency Service of Ireland (ISI) and the court.

3. A protective certificate will be issued by the court, which means that creditors cannot contact you about the debt.  During this time, the PIP negotiates an insolvency arrangement between you, the debtor, and the banks or other creditors.

4. If there are no objections, the new arrangement will be approved by the court and the ISI will record it in the Register of Debt Settlement Arrangements.

2. Personal Insolvency Arrangement (PIA) – both secured debts, such as mortgages, and unsecured debts, such as credit card or personal loans.

A Personal Insolvency Arrangement (PIA) is an option for secured debts, such as mortgages, and unsecured debts, such as credit card loans or personal loans.

• A PIA lasts for six years – or seven years in some cases.

• Unsecured debts – personal/credit card loans – are settled.

• Secured debts – mortgages – may be settled, restructured and/or written-down.

• You are protected while your PIA is in place and creditors, such as banks, cannot take any legal action against you.

• You can only have one PIA in your lifetime.

Personal insolvency practitioners (PIPs) are licensed by the Insolvency Service of Ireland (ISI) to make an application for a PIA on your behalf.

How a PIP Will Help You to Find a Solution to Your Debt Problem

1. The PIP will help you to complete a prescribed financial statement (PFS) outlining your financial situation.

2. The PIP will submit your application to the Insolvency Service of Ireland (ISI) and the court.

3. If approved, a protective certificate will be issued by the court, which means that creditors cannot contact you about the debt. During this time, the PIP negotiates an insolvency arrangement between you, the debtor, and the banks or other creditors.

4. If there are no objections, the new arrangement will be approved by the court and the ISI will record it in the Register of Personal Insolvency Arrangements.

The First Step to Financial Recovery

If you are in financial distress due to mortgage arrears or monthly payments that you cannot afford or if you have mounting credit card loan and/or personal loan repayments, we can help

4. Bankruptcy – High Court process dealing with secured and unsecured debt.

Bankruptcy may be an option for you if the insolvency solutions – Debt Relief Notice (DRN), Debt Settlement Arrangement (DSA) and Personal Insolvency Arrangement (PIA) – are not appropriate. A personal insolvency practitioner (PIP) will advise you on the different options and the most suitable solution for your debt.

Criteria & Process

• You must have a minimum debt of €20,000 to be considered for bankruptcy.

• You must be resident in Ireland i.e. 183 days of the taxation year or 280 days over two years.

• Your property is transferred to the Official Assignee in Bankruptcy who sells it and pays the creditors (banks, for example).

• Your family home may be protected if a schedule of mortgage repayments can be agreed.

• A bankruptcy lasts for 1 year.

• Payments to creditors may last for 3 years, if the available funds are more than reasonable living expenses.

• Unsecured debt is written-off.

Visit the Insolvency Service of Ireland (ISI) Back on Track website www.backontrack.ie/bankruptcy for information about the reasonable standard of living, the family home and the type of debt dealt with in a bankruptcy.

Bankruptcy Period

In December 2013, the bankruptcy period in Ireland was reduced from 12 years to 3 years. In December 2015, the term was reduced further to 1 year. The bankrupt person also contributes any income greater than the reasonable living threshold towards the debt for up to 3 years (previously 5 years).

APIP lobbied for the reduction in the bankruptcy period from three years to one year – our “Submission to the Joint Committee of Justice, Defence and Equality on the Period for Bankruptcy” can be viewed here: https://www.apip.ie/ckfinder/userfiles/files/APIP%20Submission%20to%20JO%20on%20Justice%20re%20Bankruptcy,%2019-06-15.pdf

The change in legislation – the Bankruptcy (Amendment) Bill 2015 was signed into law on Christmas day in December 2015.

For further information about bankruptcy, download the Insolvency Service of Ireland’s “Information about Bankruptcy” publication here:<https://www.isi.gov.ie/en/ISI/Backontrack_Information_about_Bankruptcy.pdf/Files/Backontrack_Information_about_Bankruptcy.pdf>