HSE worker gets 70pc of debt written off in insolvency deal
A FINAL insolvency agreement has resulted in a Donegal man getting a huge chunk of his debt written off.
The man, who is in his 40s and works for the HSE, got 70pc of his borrowings wiped out by his lenders.
The money will be written off if the deal is observed over the next five years of the debt settlement arrangement (DSA).
It is understood the man was in a partnership in a family business that eventually failed.
Lobby group New Beginning struck the deal at a creditors' meeting yesterday.
The individual could not pay his debts after his business failed, and it is understood three of the State's main banks were among six creditors involved.
Personal insolvency practitioner (PIP) Ronan Duffy of Derry-based McCambridge Duffy acted for the Donegal man.
A protective notice had been issued in court in Monaghan on October 21.
At that time, creditor banks had agreed in principle to do a deal, but final agreement to go ahead was not secured until yesterday.
It is the first deal to be finalised by creditors. It has been approved by the court, after being registered with the new Insolvency Service of Ireland.
Mr Duffy, who chaired the meeting of the creditors involved, described it as very significant.
He said: "A debtor had made a full and frank disclosure to address his financial problems under the new system, and his creditors recognised that and voluntarily agreed a large write-off of the outstanding debt.
"The write-off is substantial but it should be noted that the debtor is paying back what he can afford and this will vary from case to case depending on income and any assets."
New Beginning co-founder Vincent P Martin called the insolvency regime "a fair system".
He said: "Debtors are obliged to repay as much as is feasible -- but it contains in-built recognition that saddling people with debts they can never realistically re-pay is not in anyone's best interests.
"These agreements are an important step in returning individuals to solvency, and will allow Ireland's economic recovery to get under way fully."