Despite initial apprehension that financial institutions would force families out of their homes and on to the side of the road in pursuit of unpaid mortgage loans, it is apparent from the first and admittedly small batch of cases that these fears have not materialised.
A sample of 20 proposed settlements negotiated under the personal insolvency regime has shown that a minority, five, handed back the keys to their properties because of over-whelming debt. The majority managed to stay on in their homes by arriving at agreement with their lenders.
In some cases substantial amounts of money were written-off by the financial institutions, following negotiations through the Personal Insolvency Service Practitioner (PIP) provided certain agreed targets were met. Others had credit card and credit union loans written-off.
Although it is a small sample the results, agreed in principle through personal insolvency experts Grant Thornton Debt Solutions, appears to show that there is a way forward where there is goodwill on both sides.
Of course all cases are different. But these results appear to show that by working with financial institutions PIPS have been able to get their clients out from under an overwhelming burden of debt, not without sacrifices, but at least with conditions that will give them some hope of a debt free future.
Some clients were even able to hold on to modern-day luxuries like health insurance.
Financial institutions are, it seems, beginning to see sense when it comes to writing down debt on homes.
Borrowers have to recognise that they signed on for a loan and have a duty to pay it, while the financial institutions have to accept responsibility for giving unwarranted amounts to some borrowers and as such have a duty to be part of the solution.
It also comes on a day when the first proposed debt settlement arrangement between a debtor and his creditors through the new insolvency procedures was agreed, although the arrangement has yet to go through Insolvency Service of Ireland and the Circuit Court before it is ratified.
Personal Insolvency practitioner Ronan Duffy said that expenditure guidelines agreed under insolvency agreements were never meant to be either a "beans on toast diet" or to allow a debtor a "life of luxury."
It is to be hoped that there is a future for debtors who make a full and frank disclosure and that creditors will recognise that in the vast majority of cases debt resolution is the only way the matters can be brought to a conclusion.