While there is provision within the insolvency code to allow a personal insolvency application with more than €3,000,000 of debt to be considered, it is not highly likely that we will see much of this. The reason being that insolvency solutions are often predicated on some level of reasonable recovery.
This is the same as examinership for companies, so the individual must be a ‘going concern’, where they aren’t then bankruptcy becomes the more viable option which is perhaps also more appropriate.
So the message is simple, don’t try to use solutions that don’t or won’t work. Insolvency is often critiqued for any manner of reasons, but that is in part because it isn’t the actual appropriate solution.
Equally, bankruptcy may not be, we had a client this week who would be better off working with the bank then opting to go to the UK for an IVA style solution, the only thing we know for sure is that there are no forgone conclusions in dealing with debt and each case is unique.
So be weary of getting into what is called ‘path dependency’, where you are hellbent on one solution because as you get closer to doing it you may find it isn’t actually the best one for you. That’s why we insist on a consultation, because these things require professional advice from people who have been doing this work for a long time.