Debt Solutions

If you are unable to pay your debts and do not see yourself being able to do so in the next few years, there are 4 debt solutions which may help you.

Which option is right for you will depend on:

• how much you owe
• the type of debt
• your income
• your assets

• after Reasonable Living Expenses are deducted

** Subject to certain exemptions

*** Subject to a cap of €3 million, unless creditors consent to a higher level

****Whilst it is possible to apply for bankruptcy yourself, it is advisable to seek professional advice to assist you in the process.

If you or someone you know is struggling with debt the ISI can help - visit our debtor focussed information website http://www.backontrack.ie/ to find out about the debt solutions available or free text ISI to 50015 for a callback from our information line.

• after Reasonable Living Expenses are deducted

A Debt Relief Notice (DRN) is an insolvency solution for people who have a low income, few assets and debts of less than €35,000.

It is a formal agreement that allows for the write off of debts up to €35,000 where it is unlikely that a person will be in a position to repay them and it is unlikely their financial situation will improve in the next 3 years.

Debts such as personal loans, credit card loans, store cards, credit union loans and overdrafts could be included in a DRN.

However, it is not a suitable solution for people with a mortgage.

Applying for a Debt Relief Notice

In order to apply for a Debt Relief Notice, a person should contact an Approved Intermediary - these are a network of qualified debt advice professionals appointed by the ISI to deal with Debt Relief Notices and are experts in the area of debt advice.

Approved Intermediaries are located around the country - contact details are available online or call the ISI's Information Line on 01 764 4200.

More information on this solution can be found in the guides below.

What a Debt Settlement Arrangement is

A Debt Settlement Arrangement (DSA) is an insolvency solution for people who have unsecured debts - credit cards, loans, overdrafts. For mortgage-related debt please see Personal Insolvency Arrangement.

A Debt Settlement Arrangement is a formal agreement with creditors that allows for some write off of debt. With this solution a person agrees to pay a percentage of their overall debt over a specified period of time. At the end of that period of time they will be solvent.

Applying for a Debt Settlement Arrangement

In order to apply for a Debt Settlement Arrangement, a person should contact a Personal Insolvency Practitioner (PIP) - these are a network of qualified professional advisors regulated by the ISI to deal with Debt Settlement Arrangements and are experts in the area of debt advice.

Personal Insolvency Practitioners are located around the country - contact details are available online or call the ISI's Information Line on 01 764 4200 or free text ISI to 50015 for a callback from our information line.

More information on this solution can be found in the guides below.

• Subject to a cap of 3 million, unless creditors consent to a higher level.

What a Personal Insolvency Arrangement is

A Personal Insolvency Arrangement (PIA) is an insolvency solution for people with unsecured and secured debts. Secured debt is a debt backed or secured by an asset (for example, a housing loan where a house is mortgaged to secure the loan debt).

It is a formal agreement with creditors that will write off some unsecured debt and restructure any remaining secured debt, while keeping the person in their home where possible.

Applying for a Personal Insolvency Arrangement

In order to apply for a Personal Insolvency Arrangement , a person should contact a Personal Insolvency Practitioner (PIP) - these are a network of qualified professional advisors regulated by the ISI to deal with Personal Insolvency Arrangements and are experts in the area of debt advice.

Personal Insolvency Practitioners are located around the country - contact details are available online or call the ISI's Information Line on 01 764 4200 or free text ISI to 50015 for a callback from our information line.

More information on this solution can be found in the guides below.

Free advice from a Personal Insolvency Practitioner

If you are in arrears on your home mortgage you could be eligible for a free PIP consultation under the Abhaile Free Mortgage Arrears Support scheme, Get more details on Abhaile.

• Whilst it is possible to apply for bankruptcy yourself, it is advisable to seek professional advice to assist you in the process.

What bankruptcy is

Bankruptcy is a formal High Court insolvency solution for people in debt over €20,000. During the bankruptcy process, the ownership of the person’s property and possessions transfer to the Official Assignee in Bankruptcy to be sold by him for the benefit of those to whom the individual owes debts (creditors).

When the person’s property is sold, the Official Assignee will make sure that the proceeds are shared out among creditors and any outstanding debt will be written off.

Bankruptcy applications

Bankruptcy proceedings are brought in the High Court. The application for a Bankruptcy Order is filed in the Office of the Examiner of the High Court.

Bankruptcy normally lasts for 1 year.

Main consequences of Bankruptcy

• all unsecured debts are written off
• property and possessions transfers to the Official Assignee (except for essential assets up to a value of €6,000)
• any surplus income (income less reasonable living expenses) must be contributed towards debts for up to 3 years
• if seeking credit above €650, a person must disclose that they are bankrupt
• discharge from bankruptcy is normally after 1 year. However, this term could be shorter if settlement with creditors is reached but it could also be extended if a person does not fully cooperate with the process

More information

Bankruptcy guides

A comprehensive guide is available below.