A businesswoman who became insolvent following the collapse of the construction sector in the mid-2000s has had the vast majority of her €14.3m debt written off under a personal insolvency arrangement (PIA).
Sharon O’Reilly (52) owed €11.6m to Nama on foot of personal guarantees and owed €2.7m in mortgage debt to Pepper Finance.
However, under a PIA approved by the High Court, the bulk of this will be written off and she will be able to save her €950,000 family home in Malahide, Co Dublin, which is in negative equity.
The debt deal involves the payment of a lump sum of €41,000 to creditors, proceeds from the sale of a property in Spain in 2017 and additional contributions of €3,866 over a three-year period.
Ms O’Reilly’s mortgage term has been extended until she reaches the age of 70, and she will continue to make payments on it, with these increasing over the term of the mortgage.
The arrangement was presented to Mr Justice Mark Sanfey by Keith Farry, counsel for Ms O’Reilly’s personal insolvency practitioner Niall Moran. Documents provided to the court showed creditors would fare better from the PIA than if Ms O’Reilly was forced into bankruptcy.
The case is the latest in a series of large write-downs approved by the court under legislation aimed at resolving debt while keeping debtors in their homes.
Ms O’Reilly worked in the commercial lending department of Anglo Irish Bank in the 1990s and was later involved in a number of asset management and property development ventures.
According to her application, her insolvent status arose due to the construction sector crash in the mid-2000s, which led to her falling into negative equity on building projects.
Subsequently, receivers were appointed, properties and sites sold and residual debt crystallised, which put pressure on her household income and caused financial strain.
She is currently unemployed and has been renting out a room to students while also assisting in her partner’s business as a creditor controller, for which she was not being paid. Her application said she wanted to move on with her life as her children are near the end of their education.
It said her partner agreed to make his income available for the purposes of allowing her to make a proposal that would return her to solvency.
Under the debt deal, a buy-to-let property she owns, valued at €800,000, is to be sold.
Two other buy-to-let properties, valued at €450,000 and €350,000, are to be retained on a 19-year mortgage and interest-only payments.
Both will be sold before the end of the term of the mortgage to settle the liabilities on the properties in full.