Following the Personal Insolvency Act, 2012, the Insolvency Service of Ireland (ISI) - an independent government body – was set up to help tackle personal debt problems. ISI offers a range of debt solutions, including a regulated network of qualified professionals that can help to restructure and even write off debt that the debtor is unable to repay.
Research carried out by ISI showed that many people are living far below a reasonable standard, yet do not seek help because they do not see themselves as insolvent. The research also found that the majority of people are committed to paying off their debts themselves and that this mind set is among the factors contributing to lower-than-expected numbers of people seeking help.
In October 2014, ISI launched “Back on track”, a national communications campaign to highlight the simple indicators that show people they need help. Lorcan O’Connor, Director of ISI, commented “We met many people who didn’t actually realise that they were, in fact, insolvent. They knew they were struggling. They knew they were making all manner of sacrifices, including on the basics. They felt badly for the impact it was having on their children. Yet, the last thing they wanted to do was to turn their back on their debts, or seek help. We want these people to see that there is help available, that there’s no embarrassment in seeking it and no shame in taking it. When they come to us, they will have a fresh start with some debt potentially written off, and the remainder at a manageable level.”
What about the costs?
The perceived cost of insolvency solutions was among the issues raised during research focus groups. In order to remove any perceived barrier to seeking help, the ISI has suspended all application fees for debt solutions until the end of 2015. While the majority of Personal Insolvency Practitioners (PIPs) charge a consultation fee, in almost all cases this is in the region of €100-€300 and some may not charge an initial fee at all. When a PIP takes on a case, the debtor gets protection from creditors, resulting in more to spend at the end of each week on food and day-to-day expenses, and puts people on a path to a fresh start.
Will I be declared bankrupt?
The ISI also deals with bankruptcy. But you must first have tried to solve your debt problems using the three alternatives listed below, before you can seek to be made bankrupt.
- Debt Relief Notice (DRN) – debts on or under €20,000
- Debt Settlement Arrangement (DSA) – unsecured debt only
- Personal Insolvency Arrangement (PIA) – unsecured and secured debt