Friday 19 January 2018

Sinead Ryan

Ryan's review

First the good news: the launch (finally) of the new Insolvency Service of Ireland (ISI) has meant that at last beleaguered debtors have some options available to them. The bad news is that the service is only available to wealthy broke people. Confused? What did you expect?

Instead of creating state-appointed Personal Insolvency Practitioners (PIPs), the Government decided the service would be privatised – meaning that PIPs must get paid first (much like a preferred creditor) before undertaking any work. This is only fair, but with fees ranging from €250 into the many thousands, it's not affordable for those actually on their uppers.

For the very poor, with debts under €20,000 and no property, the very excellent MABS will be authorised to issue Debt Relief Notices. These people will be dealt with fairly, speedily and, crucially, for free.

Anybody else, and you'd better find a PIP. And to be honest, if you don't have a regular income stream we don't fancy your chances. PIPs have to negotiate a deal between creditors and debtor. They need to show that you can service some debts for at least five years. That, and their fees, need to be appropriated from your income/assets. Any write-off of debt won't happen until after that period.

So, we're not exactly expecting Lorcan O'Connor and his band of merry men and women to be over-run. There'll be a splurge of early cases which have been waiting behind the scenes for the legislation, and estimates of first-year applicants range from 15,000-25,000; but really, it was never a solution for the masses.

If you have only mortgage debt, best do a deal directly with the bank. If you can.

On Twitter: @sinead_ryan

Irish Independent

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