Open consultation for bankruptcy rule changes

The Oireachtas Justice Committee is having an open consultation for people who want to give their view on changing the bankruptcy rules so that a person is discharged after 1 year rather than the present standard of 3 years.

The page with the details can be found here, it closes on the 19th of June.

Our view is that 1yr would be of benefit to the people involved and give some extra creditor compulsion to dealing with debtors. On the other hand, there may be concerns about creditor lead petitions as well as ‘payment orders’ that could still go well beyond the one year term.

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Irish Times cover the story of a person going for bankruptcy and mention BankruptcyAdvice.ie

The Irish Times did a story on a person looking to go for bankruptcy and mentioned us in the article.

Conor Pope did a great job of outlining the issues in general and in particular to Rory, but this line sums it “He owes €60,000 to half a dozen lenders including banks, credit unions and credit card companies – an absolute pittance in the scheme of things – but a debt of sufficient size to give him countless sleepless nights“.

While we can’t assure people don’t lose any more sleep, we can help them find a route to finality of the problem and that, rather than superfluous statements about social rights and wrongs is really what this all boils down to.

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Bankruptcy fees increase

It is really unfortunate that upon bringing out new rules on bankruptcy that the cost of doing it went up! The costs will now be €650 for the official assignee (stays the same)  stamp duty of €190 (almost doubles),  €20 affadavit fee, then €50 to athe petition in ‘Iris Oifigiuil’.

The rump of the increase is in the stamp duty at the examiners office, this used to be €80 now it’s more than double that amount. The problem with this is that many people going bankrupt are on welfare and there is no simple path in some cases towards people on the dole being able to raise this money.

We have yet to see a case where it was impossible, often it means borrowing from relatives or getting friends to help out, selling a car or some other asset, but raising the costs just makes it that little bit tougher on people and means there is less money to pay for professional advice, something many of them would do well to obtain.

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Self adjudicated bankruptcy hearings have started

This week in a court presided over by Judge McGovern there were 11 self-adjudicated bankruptcies. The first six were represented by solicitors.

In the first petition, the Judge asked for proof of efforts to reach arrangements with creditors.

He emphasised that he needs to be satisfied that actual steps  were taken to negotiate with all the creditors. The solicitor said they had included a letter from PIP stating that he had reviewed matters and the best options available was bankruptcy as they were below the income level for a PIA or DSA.

Judge McGovern said that a bald statement in the affidavit that reasonable efforts have been made is not enough. All unsecured creditors, not just the bank or main creditor, must be contacted.

In the first six cases, once the judge said he was happy to adjudicate the debtor bankrupt, the solicitor asked for three orders.

1.Order specifying the date of the statutory sitting

2.Order permitting the adjudication to be published on the ISI website as per the Companies (Miscellaneous Provisions) Act 2013.

3.Order dispensing with the requirement to …

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Some solutions don’t work

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 …

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Sunday Times covers bankruptcy and mentions us 19th January 2014

We were pleased to see one of Ireland’s best known personal finance journalists Jill Kerby cover bankruptcy and mention our firm in the process.

Jill has long been an advocate of proactive solutions to debt and we think that our view on how bankruptcy and why it’s an important tool for debtors resonated with that outlook. Click on the article below to see the image in full scale.

 

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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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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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