Sunday Business Post 12th January 2014

We were pleased with the write up we got in the Sunday Business Post this week where we discussed Bankruptcy Advice and how we want to be the champions in this space. Bankruptcy is a full reboot of your finances, it does come with downside but it also offers guaranteed finality and on that front we believe it has an important place in the debt solution sphere.

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Is ‘free’ better or does it just cost less?

Normally when somebody is good at something they don’t do it for free, that isn’t to say they never offer their talents for free at times, or at their own discretion, but not all the time.

There are plenty of ‘free solutions’ for people in many areas, we have free hospitals and yet half the population pay for health insurance. There is free debt help through long running organisations like MABS and yet people still opt to come to private operators to get the solutions they need.

And that is why we made a decision from the outset to focus on a low cost rather than an unsustainable ‘free’ model. We value our time and the years we spent becoming experts and in turn we sell those talents at the lowest price we can in order to help the maximum number of clients possible.

On that basis we have a large team, people with huge levels of experience, and a commitment to respond to you quicker than other people will so that this is as easy a process as it …

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DIY Bankruptcy

We have two routes to help you with your bankruptcy, the first is one which has our professional team heavily involved with you throughout the process, but we also have a DIY option which offers a low cost way of doing this.

DIY Bankruptcy (www.diybankruptcy.ie) gives you a face to face meeting with a professional advisor and support to help you get through the process on your own, this is supplemented with videos which will bring you through everything you need to do.

We think that a really low cost choice which still gives you face time with professional advisors and a road map through to the destination will be a popular option for people who want the freedom and finality that bankruptcy offers without the cost you might expect to go with it.

To find out more you can call us or send in a query.

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Our PIPs – find them on the register

We have a few PIPs working with BankruptcyAdvice.ie and you can find them on the Insolvency Service of Ireland website. There you will find Seamus Carrick (PC00107) and Anthony Joyce (PC00109) who are both fully regulated Personal Insolvency Practitioners.

That doesn’t factor in the legal, accountancy and financial advice experience we also have, but we think it’s important that you know you are dealing with people where their qualifications are recognised and registered. Some companies will put a junior in front of you, or the person heading the firm doesn’t have the relevant qualifications, we don’t operate like that, we don’t try to talk a good game, we are more interested in playing a good game.

 

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Insolvency unaffordable? That’s not true because here’s how it works

It’s really unfortunate that there are commentators who perpetuate the myth that ‘insolvency is unaffordable’. This is probably best viewed as an example of financial illiteracy showing through what should otherwise be reasoned deduction. Here is a video showing how creditors pay for insolvency, it goes through a simple ‘T account’ breakdown of where the cost lies.

The easiest way to think about it is like this, imagine you go to a bar with another person and they give you money to pay for drinks. The person who actually pays for the drinks is you, you give the money to the bartender, but the cost is born by the person who gives you the money to do it with.

Using that analogy the borrower is the one paying, but the cost is born by the creditors, check out the video, it will help to make that clear.

And remember that when you hear how a person ‘can’t afford to go insolvent’ that they are making the mistake of repeating something they heard without investigation, normally what they really mean to …

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What happens when you don’t comply?

An important aspect of bankruptcy is how the person deals with the Official Assignees requirements – your compliance makes a big difference. While a person can decide not to play ball, there are consequences to this.

One such example is Paul Codd the former Wexford hurler who spent a weekend in jail for failure to comply with orders surrounding his bankruptcy. His case focused on the failure to comply with an order to return leased machinery and he only avoided more prison time by promising to comply.

So when you are getting your advice (and we always advise going to professionals with relevant qualifications even if it isn’t us) remember that you are not getting a ‘get out of jail free’ card, in fact, messing about with your bankruptcy process will get you jail time in some circumstances as this case showed.

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New bankruptcy guide and scenarios published today

The Insolvency Service of Ireland launched some new information today on the back of the changes announced in Bankruptcy law.

The two main documents are a ‘Debtors Guide to Bankruptcy‘ and a ‘Bankruptcy Scenarios‘ booklet which gives worked examples. These are both welcome publications in light of the new rules.

Some of the main changes we highlighted before were that the need to advertise in the national press will be removed – you will be able to do this on the ISI website in the future and also the lowering of the discharge date down to 3 years automatically (unless the Official Assignee has cause to do otherwise; for non-compliant bankrupts).

These documents are well worth reading before considering bankruptcy, along with the services we help to co-ordinate they will be good to keep on hand for reference purposes.

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Can you get bankruptcy representation ‘for free’

This is something we are hearing about more often in the media, that some organisations are doing this ‘for free’ for their clients. We are highly skeptical of this message as in the first instance there is no ‘free’ bankruptcy process in Ireland.

There are certain expenses which will have to be paid irrespective of what advice you get, payments to the Official Assignee and other application fees that are set costs laid down by the various branches of the state such as the Examiners Office.

Then you have professional services such as solicitors, barristers, accountants, financial advisors and potentially others. That they would all work ‘for free’ is true in some instances, most of us in industry do a certain amount of pro-bono work, but it isn’t a business model without funding, meaning it can’t be broadlyl offered.

Some representation groups have said in the past that they work for free but time and again what we have seen is that the do charge, they may say they only charge in some cases, but after a while there are …

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New bankruptcy regime expected within days

We have been informed that the new bankruptcy changes are due to come into force in a matter of days. This will mean that the discharge period will be reduced to 3 years automatically (in line with European norms).

Another change that will come about is that people will be able to advertise intention to petition for bankruptcy on the Insolvency Service of Ireland website. up to now a national paper advertisement was required, but that is set to change and instead a person will be able to submit their name to the ISI website meaning a figure of several hundred euro can be saved in the process.

All things considered, the changes will bring about both a reduced cost to going bankrupt as well as the introduction of the reduced automatic discharge time. What this means for people in debt who are considering bankruptcy is that the older version (this ‘change’ has been flagged for some time and many commentators are of the mistaken opinion the current discharge time is 3yrs) is eradicated and the discharge will occur in …

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An ‘avalanche of bankruptcies’? It may be the solution of choice in time.

Ross Maguire a barrister was quoted in the Sunday Independent stating that  “There is going to be an avalanche of people applying for bankruptcy through the courts. We have had hundreds and hundreds of people contacting us in the past few weeks inquiring about the new legislation” (via the advocacy group New Beginning).

“We are seeing an explosion of interest in bankruptcy. Each week we give seminars at which hundreds of people show up.

This is depressing news in one respect, but positive in when viewed as people considering a total financial reboot which will bring with it debt forgiveness. For too long people have tried to deal with and negotiate with banks that didn’t want to negotiate with their clients. Bankruptcy will fundamentally change this and change the dynamic.

For our part we hope to be part of that change, our bankruptcy service is designed to give people value for money while helping them make a difficult choice but not one that is tied to bankruptcy, rather one that will help them make the right choice – and that …

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